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B11-BOTTAWA/QUEBEC EDITION ■ FRIDAY, SEPTEMBER 13, 2019 ■ GLOBEANDMAIL.COMS&P/TSX
16,643.
+32.DOW
27,182.
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US$1,507.
+4.China has repeatedly declined to provide
Canada with adequate scientific evidence
to justify shutting the door to imports of
Canadian canola seed, Ottawa says in a
new complaint to the World Trade Orga-
nization.
Canada this week laid the groundwork
for a challenge at the WTO of China’s de
facto ban on Canadian canola seed that be-
gan in March, a measure that targeted the
former No. 1 export from Canada to China.
China has effectively stopped buying ca-
nola seed from Canada since March in
what trade experts say is economic retri-
bution for the arrest of Chinese tech exec-
utive Meng Wanzhou at Vancouver Inter-
national Airport last December. Canada
was fulfilling a U.S. extradition request un-
der the terms of a treaty with the United
States. The Americans allege Ms. Meng,
chief financial officer at Huawei Technol-
ogies Co. Ltd., helped the company violate
U.S. economic sanctions against Iran.
“Canada has repeatedly attempted to
obtain information from China regarding
the scientific basis for its measures and on
the process to restore full market access
for Canadian canola seed,” the Canadian
government said in a Sept. 9 filing to the
WTO.
“To date these efforts have failed to pro-
duce satisfactory results,” thegovernment
said.
China’s refusal to even lay out a full ra-
tionale for the seed ban signals the depth
of Beijing’s intransigence, veteran Cana-
dian trade consultant Peter Clark says.
Under WTO rules, member countries
are allowed to restrain trade but only if
there is a science-based risk to human, ani-
mal or plant health, and such measures
should not unnecessarily restrict trade.
CANOLA,BCanadatakes
canolaseed
disputewith
ChinatoWTO
STEVENCHASEOTTAWAThe fight to controlAimia Inc.’sfuture is
escalating after a second set of sharehol-
ders questioned the Canadian loyalty pro-
gram provider’s leadership and launched
a campaign to shake up its board of direc-
tors.
The shareholders, who collectively own
at least 5 per cent of the company and
who include LFF Partners and LARC Cap-
ital Holdings, have requested a special
meeting to nominate four directors to Ai-
mia’s board, according to a statement re-
leased on Thursday. The shareholders al-
so want to boot the four longest-serving
directors on Aimia’s board – a group that
includes chief executive Jeremy Rabe.
The proposal opens a new front for Ai-
mia to fight after the company’s largest
shareholder, Mittleman Brothers, voiced
its opposition to Aimia’s current strategy
and suggested it may propose its own
slate of directors. The battle turned fierce
in July when Aimia sued Mittleman. This
week, Mittleman countersued members
of the company’s leadership team and
board, alleging defamation and mislead-
ing representations.
Aimia’s business strategy lies at the
heart of the battle. Since selling the Aero-
plan loyalty program to Air Canada late
last year, Aimia has pledged to acquire
businesses in the loyalty rewards market.
Mittleman and the second group of share-
holders oppose this plan because they be-
lieve Aimia has struggled in this market.
Air Canada and Aeroplan had been
partners for years, but, in 2017, the airline
announced plans to pull out of Aeroplan
in favour of building its own internal pro-
gram. The news sent Aimia’s shares plum-
meting because Aeroplan delivered
roughly 80 per cent of its operating in-
come. Air Canada eventually changed
course and decided to buy Aeroplan in-
stead, paying $516-million. A few months
after the deal’s announcement, Toronto-
Dominion Bank agreed to pay Air Canada
$1-billion to be the program’s lead finan-
cial partner.
AIMIA, BAimiashareholders
groupdemands
ousteroffour
boardmembers
TIMKILADZEHudson’s Bay Co.reported a big quar-
terly loss as sales slumped at its name-
sake Bay department stores, highlight-
ing the challenges facing the Canadian
retailer while it pursues a turnaround
plan.
Toronto-based HBC, which also
owns luxury retailer Saks Fifth Avenue,
posted a net loss from continuing op-
erations of $462-million, or $2.51 a
share, for the fiscal quarter ended Aug.
3, compared with $104-million, or 58
cents a share, in the same period last
year.
Revenue was roughly flat at $1.85-
billion, compared with $1.86-billion
last year.
Last quarter, chief executive Helena
Foulkes said that it had shifted away
from a strategy of selling less-expen-
sive products to attract former custom-
ers of the bankrupt Sears Canada Inc.This quarter, the Bay stores have been
changing their product mix, selling off
more than 300 “unproductive brands”
and introducing roughly 100 new ones
to its stores this fall, such as Anthro-
pologie Home, L.L. Bean and some
Scandinavian fashion brands.
The Bay is also more aggressively
advertising product exclusives in
stores, said Ms. Foulkes, who was hired
last year to revive the company’s per-
formance.
HBC, BHBClossesgrowasbrand
transitiondentsBaysales
Companyridsitselfofunderperformingstoresandshiftsfromsellingless-expensivegoods
SUSANKRASHINSKYROBERTSON
RETAILREPORTER
M
ario Draghi is going out
with a bang.
At his penultimate
rate-setting meeting before he
hands the whole sorry show to
Christine Lagarde – the former
boss of the International Moneta-
ry Fund – at the end of October,
the president of the European
Central Bank hauled out his ba-
zooka for one last time in an ef-
fort to revive the European econ-
omy and stoke inflation.
The ECB is pushing interest
rates deeper into negative territo-
ry, sending its deposit rate to mi-
nus 0.5 per cent from minus 0.
per cent; relaunching the bond-
buying program (known as quan-
titative easing, or QE) after a
mere nine-month hiatus, at €20-
billion ($29-billion) a month;
and extending cheap loans to
banks.
Mr. Draghi’s fresh stimulus
package comes as Europe shows
worrying signs of recession. Ger-
many and Italy seem to be lurch-
ing back into one. Britain will al-
most certainly sink into the eco-
nomic quagmire after Brexit.
While Mr. Draghi said there is on-
ly a small chance that the 19 euro-
zone countries, as a whole, will
enter recession, the risk has
“gone up.”
Will his package work? Lock-
ing in ultraloose monetary policy
for several more years may deliv-
er a marginal, but only marginal,
lift to the economy and to infla-
tion, which is better than noth-
ing. What would do a better job is
a hefty spending package, nota-
bly from tightwad Germany,
which considers running budget
deficits a moral failing.
“Central banks are running out
of ammunition,” Andrew Sen-
tance, an economist and former
member of the Bank of England’s
monetary policy committee, said
in an interview Thursday.
REGULY,BAsECBrunsoutofammunition,
it’stimeforEurope’sleaders
torampupspending
ERIC
REGULY
OPINIONLONDON
ACTIVISION BLIZZARD........................... B
AIR CANADA.......................................... B
DREAM GLOBAL REIT............................. B
GOLD STANDARD VENTURES................ B
ROOTS .................................................... B
STELLA-JONES ....................................... B
SUMMIT INDUSTRIAL INCOME ............... B
TRANSAT................................................ BCOMPANIES[TECHNOLOGY]Canada’sbankstreadcarefully
astheyexploreAIfrontier
Financialinstitutionsstilllearninghowtomanageartificial
intelligenceamidconcernsaboutprivacy,lackoftransparency BFoteiniAgrafioti,chiefscienceofficeratRoyalBankofCanadaandheadofBorealisAI,spokeaboutresponsibleAIat
theEconomicClubofCanadainTorontoonThursday.FRED LUM/THE GLOBE AND MAILAIRLINES
MaxjetgroundingtestedAir
Canada’slimits,CEOsays BMARKETS
TSXhitsrecordhighbefore
recedinglateinsession BGRAHAM HUGHES/THE CANADIAN PRESS