Companies in Canada controlled by foreign firms recorded double-digit investment growth in 2006, propelled by investment in mining and oil and gas extraction, retail trade and manufacturing, Statistics Canada reported today.

Investment by foreign-controlled establishments increased 10.7% to an estimated $53.8 billion in 2006. At the same time, investment by domestic firms rose 7.4% to $153.2 billion.

The figures from StatsCan refer to investment in physical properties, specifically machinery, equipment and non-residential structures. They do not pertain to investment in equities, bonds or money markets.

American-controlled establishments accounted for the majority of foreign investment with a share of 69.6%. Those from Germany were a distant second at 6.6% of the total, followed by Japanese firms at 5.6%.

American-controlled investment amounted to nearly $37.5 billion in 2006, up 7.9% from 2005, StatsCan said.

Foreign firms accounted for 43.4% of total investment in the Northwest Territories, the highest proportion in the nation. It was followed by Newfoundland and Labrador with 39.1% and Nova Scotia at 31.6%. In Ontario, the proportion was 28.2%.

Two provinces alone, Ontario and Alberta, accounted for 63.2% of total foreign capital investment.

Investment by foreign-controlled establishments was concentrated in a handful of industries.

Three industries, mining and oil and gas extraction; finance and insurance; and manufacturing, accounted for just over two-thirds (68.5%) of the total.

In the manufacturing sector, the robust investment growth among foreign-controlled firms continued, in sharp contrast with the lacklustre performance of domestic firms, among which investment growth has been flat.

In the retail trade sector, foreign firms boosted capital spending by 36.4%, while the increase among domestic firms was only 4.0%.

In the mining and oil and gas extraction industry, investment by domestic firms slowed, while investment by foreign firms accelerated. Foreign firms invested $1.7 billion more than they did in 2005, equivalent to a 12.3% increase.