A new report from the Atlantic Institute for Market Studies (AIMS) paints a bleak picture of investment trends in the Maritime provinces and points the finger of blame – at least, in part – at the region’s three provincial governments.

“Governments have raised taxes, registered increasing provincial government debt and halted lucrative shale gas development,” the report from the Halifax-based, right-leaning think-tank concludes.

The conclusion is not surprising. The Maritimes are struggling to find and maintain a strong economic foothold. Nova Scotia is leading the way with predicted gross domestic product (GDP) growth this year of 1.2% and slightly less next year, according to Royal Bank of Canada (RBC). Prince Edward Island and New Brunswick aren’t expected to do as well. The forecast for the Island is GDP growth of 1.1% in 2016, dropping to below 1% in 2017. New Brunswick’s numbers are even lower. RBC forecasts zero growth this year (others are calling for negative growth) and 0.5% next year.

The AIMS study contends that a historic dividing line has swept across the region: pre- and post-recession. According to the report, entitled Private Sector Investment in Atlantic Canada, investment in the Maritimes has dropped significantly in the past 10 years. The AIMS paper states that the Maritimes have recorded the weakest performances in real per capita business spending in all of Canada.

The AIMS paper states that those numbers are unlikely to change: “Given the absolute decline in constant dollar business spending in the Maritimes, long-term prospects for strong economic growth in the region remain poor.” The paper mentions other “peripheral provinces,” including Alberta and Saskatchewan, and notes their growth has been defined by strong private-sector investment spending.

So, what’s a region to do? The AIMS report offers two suggestions, neither original. First, it calls for lower taxes, pointing out that high taxes are a deterrent to investment and that by some measures, Nova Scotia and New Brunswick are the highest-taxed jurisdictions in North America.

The AIMS report also supports an expansion of Nova Scotia’s and New Brunswick’s gas reserves, specifically through fracking, which is banned – for now – in both provinces. This strategy is a mantra for AIMS, which has long advocated for shale gas development, environmental issues aside.

Now, the three Maritimes premiers are highlighting investment as an issue. They recently unveiled a plan to build a “vibrant economic future for Atlantic Canada,” with trade and investment as priorities. Under the new Atlantic Growth Strategy, the region will be marketed “by displaying the best Atlantic Canada has to offer the world to attract new investments and grow tourism.”

Unfortunately, how this will happen isn’t clear. Perhaps the next report will offer some insight.

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