The Canada Infrastructure Bank is providing B.C. Ferries an additional $1 billion in low-interest loans to support service upgrades – including the purchase of four new vessels from a Chinese shipyard.
The federal Crown Corporation said Thursday $690 million would go towards the four diesel-battery hybrid vessels, while the rest is earmarked for B.C. Ferries’ electrification infrastructure. The bank said the investment builds on an initial $75 million loan announced in May 2024.
B.C. Ferries is an independently run company, with the provincial Crown as the sole shareholder.
The CIB announcement doesn’t mention the fact the construction of the new vessels is being contracted to a Chinese state-owned shipyard.
The bank said it’s estimated the four vessels will result in more than a $1 billion invested by B.C. Ferries in the local maritime sector for all the repair and refits required over their lifespans.
B.C. Ferries announced in early June it had selected China Merchants Industry Weihai Shipyard to build the four vessels to replace some of its oldest ferries. The company said the decision followed a “rigorous global procurement process” that was open to Canadian shipyards, though it said no Canadian shipyards bid on the contract.
B.C. Ferries has faced criticism from unions, the B.C. Conservatives and even federal Transport Minister Chrystia Freeland for the decision.
Freeland said in a letter to B.C. transportation minister Mike Farnworth on June 16th she was “dismayed” to hear of the deal, and asked the minister to confirm “no federal funding would be diverted to support the acquisition of these new ferries.” She notes China has imposed 100 per cent tariffs on Canadian canola oil, meal and pea imports, as well as 25 per cent duty on Canadian aquatic products and pork.
Premier David Eby said last week it’s concerning that no Canadian companies bid on a B.C. Ferries contracted to build the new vessels, but he wouldn’t intervene in the company’s decision. He said the vessels are “urgently needed,” and the province cannot risk a service breakdown.
He pushed back against Freeland’s letter in an interview with CHEK News recorded on June 20th and released on Friday. Eby said he was frustrated by the letter, saying the federal government has been lagging in funding ferries in B.C. for years.
“We believe that this partnership with the CIB will make a big impact in avoiding additional pressures on fare increases for our customers compared with borrowing from private markets,” said B.C. Ferries CEO Nicolas Jimenez in a statement.
He said B.C. Ferries expects to save about 650-million dollars in debt interest charges over the full term of the loan.
B.C. Conservative Transportation Critic Harman Bhangu said in a letter to Freeland he shares her concerns about the deal, and requests clarification about whether the CIB’s loan will be reconsidered.
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