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MNA Expansion Plan May Not Get Government Aid

(Akron/Tire Review) Even as Michelin North America (MNA) prepares to pour $80 million into expanding truck tire production at its Waterville, Nova Scotia, plant, the recent national elections in Canada threaten to derail the plan, according to reports by CBC.

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As part of the expansion deal, the Liberal Party-led Nova Scotia government committed to giving MNA some $9.4 million in interest free loans. With the Conservative Party now in control, there are questions whether the loan offer will be met.

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"We’ve committed $9.2-million in loans to Michelin to make sure they are able to expand their facilities," Robert Thibault, the re-elected Liberal MP for West Nova, told CBC. Thibault has urged the incoming Conservative government to honor the loan commitments.

The CBC said the situation “is being described as a precedent-setting decision for Stephen Harper (the incoming prime minister), one that will set the tone for how the Conservatives deal with regional development.”

Canadian Taxpayers Federation representative John Williamson, though, feels that honoring the commitment “would set a bad precedent,” the CBC report said. "It’s a very symbolic decision. While it’s not necessarily a lot of money when we look at the size of the global budget in Ottawa, this decision is going to set the tone for the rest of his (Harper’s) administration when it comes to dealing with subsidies to large companies," he was quoted as saying.

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Political caucuses from Western Canada and Ontario will also have their say, Williamson told CBC. "Many of his caucus from Western Canada and even Ontario will not think this is good public policy, so we are going to see some of the regional play of the nation at work in this decision in Nova Scotia," he said.

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