Canada Approves Foreign Energy Takeovers

The Canadian government has approved the controversial 15.1 billion dollar takeover of oil and gas firm Nexen by China's state-owned offshore oil company CNOOC.Restrictions were placed on any future foreign deals,however.
To be blunt,said Canadian Prime Minister Stephen Harper,Canadians have not spent years reducing the ownership of sectors of the economy by our own governments,only to see them bought and controlled by foreign governments instead.Foreign state control of oil sands assets has reached the point at which further foreign state control would not be of net benefit to Canada.
From now on,state-owned enterprises may only own minority stakes in Canadian enterprises,except in exceptional circumstances.
What we are doing here is preventing a situation which I see developing and have been worried about for a while now,where in the name of an open,globally competitive economy,we could see the transformation of our economy into a state-run economy-just a state-run economy not run by our own government.
Besides the CNOOC deal,Canada also approved the takeover of gas company Progress Energy Resources by Malaysia's state-owned firm Petronas for 5.3 billion dollars.
The CNOOC deal is the Chinese firm's largest offshore acquisition ever.CNOOC is also asking the US government to review its bid for Nexen's Gulf of Mexico assets.
Canada needs about 657 billion dollars of investment in the natural resources sector in the next decade.There were no Canadian bidders for Nexen.
CNOOC made significant commitments on transparency,employment and capital investments in exchange for government approval of the deal.
Nexen,Inc.(NXY),CNOOC Ltd(CEO),Petronas Gas Bhd(KUL:PETGAS)

Early Edition:Merkel Pleased With Summit

German Chancellor Angela Merkel said the weekend's G20 summit in Toronto,Canada was ahead of her expectations because of the detail involved.The world leaders agreed to cut their deficits in half by 2013.By 2016,the debt,or accumulated deficits,will start to come down.Canadian Prime Minister Stephen Harper said that,as our stimulus programs expire,we will focus on getting our fiscal houses in order.
The G20 leaders of leading economic nations also agreed to raise capital requirements for banks.The specificity of the goals was indeed unusual for such a gathering,which typically would have a statement of general principles released as a communique.This highlights the fragility of the global economy,which cannot accept anything less than exactitude at this point.
Ms.Merkel was in a jovial mood,given this adoption of German policy by the G20,not to mention Germany's decisive victory over England in the World Cup.The leaders followed the World Cup on their Blackberries and even watched some of it together on a big screen TV.Chancellor Merkel spoke animatedly with President Barack Obama.Clearly they have become friends during this difficult period of history.It is perhaps somewhat reminiscent of the late President Ronald Reagan and former Prime Minister Margaret Thatcher of Great Britain.

Automakers Critical To Canada

The Canadian government,on both the national and provincial level,has been watching the U.S. automakers with great concern.The automotive industry is Canada's largest manufacturing segment,directly employing more than 150,000.The industry contributes more than 14% of Canada's manufacturing output,sustaining 12 Ontario communities.In consequence,the Canadian authorities are providing 3.29 billion dollars U.S. in loans to Canadian subsidiaries of General Motors and Chrysler.The federal government will give 2.09 billion,while Ontario will provide another 1.2 billion,said Prime Minister Stephen Harper and Ontario Premier Dalton McGuinty.President Bush is authorizing 17.4 billion in aid to the struggling automakers.Ford Motor Company is not included in the loan packages,as it only needs a back-up line of credit at this time.