OTTAWA — Black Canadians who want to start or expand a business will have access to loans and supports for training and mentorship under a new federal program unveiled by Prime Minister Justin Trudeau in Toronto yesterday.
The $221-million program jointly funded by the federal government and eight financial institutions, is the first of its kind to help Black businesses on a national scale. It responds to one of the requests made in June by an open letter from the Parliamentary Black Caucus that was signed by more than 100 MPs and senators.
Trudeau said the COVID-19 pandemic has put a spotlight on the systemic gaps and economic barriers Black Canadians face every day, and that his government wants a pandemic recovery that is “inclusive and equitable for all Canadians.”
“An investment in Black excellence is an investment in economic empowerment and economic empowerment is an essential part of justice,” he said. “It’s justice against a system that has locked out far too many Black entrepreneurs and denied them the same opportunities as other Canadians.”
Ottawa is putting up $93 million over the next four years for the Black Entrepreneurship Program, while banks are contributing up to $128 million for loans between $25,000 and $250,000 for Black business owners.
The federal cash will including $33 million towards the loans, $6.5 million to collect data on the barriers preventing Black Canadians from succeeding in business, and $53 million for Black business organizations to provide mentorship, financial planning and business training.
Trudeau made the announcement at a Toronto organization called HXOUSE, which describes itself as a “think centre” to help foster innovation and opportunities for young talents in Toronto.
HXOUSE co-founder Ahmed Ismail said the program is a welcome sign of a government acknowledging systemic racism exists, addressing the fact opportunities are not equally available, and taking “the uncomfortable step of doing something about it.”
“This is something I’ve never really witnessed in all my life in any country that I’ve studied,” said Ismail, who was born in Somalia and has also studied and worked in the United States.
Liberal MP Greg Fergus, the chair of the Parliamentary Black Caucus, said the program isn’t all that is needed but will help Black Canadians be economic actors, community leaders and see “that we are full Canadians and want to participate in this wonderful country that we call home.”
“It will not in one fell swoop eliminate all systemic discrimination and the consequences but we’ve taken a positive step forward,” he said.
The program will include:
- Up to $53 million to develop and implement a new National Ecosystem Fund to support Black-led business organizations across the country. It will help Black business owners and entrepreneurs access funding and capital, mentorship, financial planning services, and business training.
- Up to $33.3 million in support through the new Black Entrepreneurship Loan Fund that will provide loans of between $25,000 and $250,000 for Black business owners and entrepreneurs. The Government of Canada is also partnering with financial institutions, including RBC, BMO Financial Group, Scotiabank, CIBC, National Bank, TD, Vancity, and Alterna Savings, to make up to $128 million available in additional lending support.
- Up to $6.5 million to create and sustain a new Black Entrepreneurship Knowledge Hub that will collect data on the state of Black entrepreneurship in Canada and help identify Black entrepreneurs’ barriers to success as well as opportunities for growth. The Hub will be run by Black-led community and business organizations, in partnership with educational institutions.