The federal government says new financial supports for Black entrepreneurs and business owners is a first step in its plan to tackle systemic racism, while working to identify barriers to success.
Ottawa says COVID-19 has highlighted and exacerbated existing systemic barriers faced by Black entrepreneurs.
Prime Minister Justin Trudeau announced investments of up to nearly $221 million in partnership with Canadian banks, including up to $93 million from the Government of Canada over the next four years. The program is the first of its kind in Canada.
Trudeau says the ideas and the ability to succeed are all there within the Black community, but access to funding remains an obstacle.
“What this program will do over the coming four years is ensure, by working with financial institutions there is much greater access to capital for these Black businesses, which face systemic barriers and discrimination every single day,” he said, during a news conference.
The program includes up to $53 million to develop and implement a new National Ecosystem Fund to support Black-led businesses. Up to $33.3 million is for the Black Entrepreneurship Loan Fund, which wil provide loans between $25,000 and $250,000. The government is also partnering with financial institutions to make up to $128 million available in additional lending support.
Up to $6.5 million is for the Black Entrepreneurship Knowledge Hub, to collect data on the state of Black entrepreneurship and barriers to success as well as opportunities for growth. It will be run by Black-led community and business organizations, in partnership with educational institutions.
The Parliamentary Black Caucus called on governments across the country to immediately address systemic racism in June.
“It would be lovely to imagine that, with four years of working with almost all financial institutions on delivering capital it will become very obvious to those institutions, what we and so many of us in this room already know, that investing in black businesses is an amazing way to create wealth and prosperity for everyone,” said Trudeau
“And in four years, we’ll look at this and perhaps there will be different challenges we have to invest in because the challenges of access will have been so significantly improved.”
Greg Fergus, Liberal MP for Hull-Aylmer, and chair of the Parliamentary Black Caucus called it a positive step in the right direction.
“It will not, in one fell swoop eliminate all of systemic racism and the consequences, but we’ve take a positive step forward.” he said during the news conference.
“It’s a way for Black Canadians to tell a different story to non-Black Canadians about what we want to do and the prosperity we want to create, the opportunities that are before us and now we have the means to do this.”
The Canadian Chamber of Commerce applauded the announcement.
“It aligns with our views on the importance of an inclusive recovery that leaves no opportunity for growth left unpursued,” it told Yahoo Finance Canada.
Jessy Bains is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jessysbains.