We’re taking our economic future more seriously
Toronto Star
By David Crane
NIAGARA-ON-THE-LAKE - Something hopeful is happening in Canada. We are starting to take the issue of our future economy much more seriously.
We must, because our jobs and standard of living depend on doing so.
This means challenges of productivity and innovation, technological change and the emergence of China, India and Brazil as major new economic players are on the radar screen in a way they have not been in the past.
This week, the Ontario Chamber of Commerce held a two-day economic summit here to begin charting an action plan for the future. This same week, the Canadian Manufacturers and Exporters association launched its community summits on the future of manufacturing in nearby Waterloo.
Also this week, the Conference Board of Canada released its Potential and Performance review, which highlighted Canada’s need to improve the capacity for innovation and productivity. And Ontario’s Institute for Competitiveness & Prosperity released a working paper on reinventing innovation and commercialization policy in Ontario.
Speaking in Niagara-on-the-Lake, Bank of Canada governor David Dodge talked of the need for our economy to develop the capacity to respond to dramatic changes in the global economy; for example, the growth of highly efficient manufacturing industries in Asia.
“This means tremendous and continuing competitive pressure on industries that have traditionally been mainstays of the Ontario economy: automobiles and parts, other transportation equipment and some areas of light manufacturing,” Dodge said. And, he warned, “over time, those pressures will increasingly be felt by industries such as steel and manufacturing. There are no signs that these pressures will abate in the years ahead.” Interestingly, much of the focus of the Ontario Chamber of Commerce summit was on people: the quality of our labour force and the next generation of that labour force. Dodge identified this is as the first effort Ontario, and, for that matter, Canada, must pursue to succeed in the new global economy.
“Ontario must ensure that its education and training systems are second to none. This applies to early childhood education and development, the provincial school system, and post-secondary education and skills training,” Dodge said.
TD Bank Financial Group chief economist Don Drummond stressed that Ontario had to do better, for example, in apprenticeship and co-op programs, and make a real commitment to lifelong learning and initiatives to help more immigrants meet Canadian requirements for employment.
Mike Grimaldi, chief executive of General Motors of Canada Ltd., spelled out his company’s Beacon Project, which would lead to a significant upgrading of the auto maker’s activities in Ontario, including greater design and engineering and advanced manufacturing, as well as closer collaboration with Ontario universities and colleges. Ontario Premier Dalton McGuinty pledged a minimum of $300 million over the next four years for equipment and other research infrastructure to boost the generation of new ideas from Ontario universities and research hospitals. Much of the credit for this goes to Economic Development Minister Joe Cordiano, who had to fight to get the money, which will be managed through a new Ontario Research Fund.
Roger Martin, who heads the Ontario Institute for Competitiveness & Prosperity, argued that if Canada was to become more innovative, then it had to pay more attention to the quality of management and the availability of management training and education. Other issues raised included improving Ontario’s infrastructure, in particular dealing with road and highway gridlock; speeding up cross-border traffic flows; addressing the challenging of an aging society; and improving relations with the United States.
Underlying all of this is a key message contained in the upcoming issue of Foreign Affairs by China expert Adam Segal. Pointing to the growing investment by China, India, South Korea and Taiwan in high-value research and skills, he argues that “technology firms can now locate anywhere. Production that was once tied to a specific place can be picked up and moved to other parts of the world. But to remain competitive, technology companies need knowledge- and information-rich regions. Firms are likely to be drawn to technology hubs that provide the concentration of ideas, talent and capital needed for future innovation. Globalization has, therefore, not eliminated geography as a concern, but rather increased the leverage of those regions that can successfully assemble the components of innovation.”
This defines the challenge, and the opportunity, in a nutshell. What’s needed now in Ontario, and Canada, is to identify the best policy instruments.
