Western Economic Diversification Canada
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Organizational Context

Raison d'être

Western Economic Diversification Canada (WD) was established in 1987 to promote the development and diversification of the economy of Western Canada and to advance the interests of the West in national economic policy, program and project development and implementation. The Minister of Innovation, Science and Economic Development is responsible for this organization.

As the department responsible for regional development in Western Canada, WD develops and supports economic policies, programs and activities to promote economic growth throughout Western Canada.

Responsibilities

Our Vision

To be leaders in creating a more diversified western Canadian economy that has strong, competitive and innovative businesses and communities.

WD's mandate, derived from the Western Economic Diversification Act, is to develop and diversify the western Canadian economy. This broad mandate allows the Department to implement programs and initiatives across the West to help western Canadians create strong, competitive and innovative businesses and communities.

With offices in each western province and its headquarters in Edmonton, WD provides a strong federal presence to promote economic development in the West. Its western base has enabled the Department to foster extensive partnerships across Western Canada with business and community organizations, research and academic institutions, Aboriginal groups as well as provincial and municipal governments.

These connections enable the Department to identify and support economic opportunities in the West and to leverage its investments to benefit the western Canadian economy. In addition, through its strong connections with federal departments across Canada and its office in Ottawa, WD ensures that western interests and perspectives are reflected in national policy development and decision-making.

WD focuses its activities in three program areas:

Launched in May 2014, the WDP  Call for Proposals process allows for  a comparative analysis of projects against clear criteria; strengthens the department's responsiveness to economic trends and industry needs; and ensures alignment with Government of Canada plans and priorities.

Business Development and Innovation: WD helps small and medium-sized enterprises (SME) develop and grow, create jobs, expand their markets, increase their exports and become more innovative and productive.  The Department  assists SMEs with international business engagement and works to attract investment to the region, as well as assist western Canadian SMEs to access opportunities linked to government procurement. Further, WD promotes the development and growth of the knowledge-based economy by building innovation capacity and supporting the commercialization of new knowledge-based products, processes and services.

Community Economic Growth: WD helps communities sustain their local economies and adjust to changing economic circumstances through departmental programs and by delivering national initiatives on behalf of the Government of Canada in Western Canada.  WD also supports community-based organizations that provide western entrepreneurs with the information, training and loans they need to start and grow their businesses.

Policy, Advocacy and Coordination: WD identifies opportunities to strengthen the western Canadian economy and coordinate economic development activities, policies and programs across the West.  WD works to build strategic relationships with key decision makers across Canada and works with western Canadian industry on defence-related procurement opportunities.

WD's Grants and Contributions support projects delivered directly by WD, either alone or in partnership with other organizations. The Western Innovation (WINN) Initiative offers repayable contributions for SMEs with operations in Western Canada to move their new and innovative technologies from the later stages of research and development to the marketplace. The Western Diversification Program (WDP) invests in projects that support WD's activities of innovation, business development, community economic development and policy, advocacy and coordination. The Western Canada Business Service Network (WCBSN) is a network of several independent organizations that receive funding from WD to provide a range of services to help create and build small businesses across the West.  WCBSN members include Canada Business Network (CBN) Community Futures (CF), Women's Enterprise Initiative (WEI), Francophone Economic Development Organizations (FEDO), Aboriginal Business Service Network (ABSN) and Entrepreneurs with Disabilities (EDP).

In addition, utilizing the Department's flexibility and ability to respond quickly to the priorities and needs of the West, WD has continued to deliver national initiatives on behalf of the federal government in Western Canada. These include the Building Canada Fund, Community Infrastructure Improvement Fund (CIIF), and the Canada Strategic Infrastructure Fund on behalf of Infrastructure Canada (programming to upgrade and expand western Canadian  infrastructure), funding to the Rick Hansen Foundation to help improve the lives of people living with spinal cord injuries, as well as the Economic Development Initiative (EDI) aimed at supporting businesses and economic development in western Canadian Francophone communities.

WD is an important contributor to a prosperous western Canadian economy and works to build on the West's traditional economic strengths while supporting the transition to a more diverse economy.

Strategic Outcome and Program Alignment Architecture

In 2014–15, WD's Program Alignment Architecture included the following programs and sub-programs that contributed to the achievement of its Strategic Outcome, helping to ensure that Western Canada continues to make a strong contribution to Canada's economic success. Detailed information about WD's Strategic Outcome, each program and sub-program can be found in Section II: Analysis of Programs by Strategic Outcome.

  1. Strategic Outcome: A growing and diversified western Canadian economy
  1.  1.1 Program: Business Development and Innovation
    1. 1.1.1 Sub-Program: Trade, Investment and Market Access
    2. 1.1.2 Sub-Program: Business Productivity and Growth
    3. 1.1.3 Sub-Program: Innovation Capacity Building
    4. 1.1.4 Sub-Program: Technology Commercialization
  2. 1.2 Program: Community Economic Growth
    1. 1.2.1 Sub-Program: Infrastructure Programming
    2. 1.2.2 Sub-Program: Community Development
    3. 1.2.3 Sub-Program: Community Futures Program
    4. 1.2.4 Sub-Program: Targeted Economic Initiatives
  3. 1.3 Program: Policy, Advocacy and Coordination
    1. 1.3.1 Sub-Program: Advocacy and Coordination
    2. 1.3.2 Sub-Program: Economic Analysis
  4. Internal Services

Organizational Priorities

In 2014–15, WD focused on the seven organizational priorities below as outlined in the 2014–15 Report on Plans and Priorities.[ii] These key areas provide greater clarity and focus for the Department on creating jobs and promoting economic growth while delivering on its mandate to develop and diversify the western Canadian economy.

Organizational Priorities
Priority Type[iii] Program(s)

Innovation

Ongoing

Business Development and Innovation

Policy, Advocacy and Coordination

Summary  of  Progress

  • WD approved 23 new projects, totaling $41.5 million under WDP in 2014–15 to support not-for-profit organizations to promote technology commercialization and innovation capacity building in Western Canada;
  • WD approved $28.1 million in repayable contributions towards 30 new projects under the new WINN Initiative in 2014–15 to support western SMEs in commercializing new, innovative products, processes and services;
  • In April 2014, WD, along with Mitacs and the Canadian Association of Defence and Security Industries, hosted a two-day Western Innovation Forum in Vancouver, BC. The event brought together over 500 participants in a business and networking opportunity in Western Canada for innovators from start-ups, SMEs, universities, and not-for-profit organizations, and federal and provincial government departments;
  • WD convened two roundtables with key stakeholders on access to capital, including sessions in Calgary at the Propel Energy Technology Forum and in Vancouver at the Canadian Financing Forum, that focused on ways of ensuring businesses have access to resources needed to commercialize new technologies;
  • WD has undertaken significant stakeholder and partner engagement in pursuit of its Innovation priority objectives, including with the National Research Council, BC Innovation Council, Innovation Saskatchewan, Canadian Venture Capital Association, Alberta Innovates Technology Futures, International Minerals Innovation Institute, Canadian Light Source, western universities, provincial ministries, and other federal departments, among others; and
  • WD identified key stakeholders in western Canada's innovation eco-system, targeting them for structured engagement with a view to striking collaborative relationships, including Sustainable Development Technologies Canada, (SDTC), the Canadian Foundation for Innovation (CFI), and the National Research Council (NRC).
Priority Type Program(s)
Skills Development and Training New Business Development and Innovation
Community Economic Growth
Policy, Advocacy and Coordination
Summary  of  Progress
  • WD approved 11 new projects in support of this priority area, totaling $6.9 million under WDP in 2014–15. These projects will increase training capacity of organizations that deliver post-secondary training, partnerships between industry and organizations that deliver post-secondary training, implement on-site training programs, and encourage the development and adoption of innovative business processes and practices;
  • WD, in partnership with Aboriginal Affairs and Northern Development Canada (AANDC) and Employment and Social Development Canada, hosted the Saskatchewan Aboriginal Economic Development and Skills Forum in December 2014. The Forum provided an overview of the Aboriginal economic development and skills training programs, and an opportunity to participate in business to funder meetings. Approximately 105 people attended including representation from 45 Saskatchewan Aboriginal communities and economic development organizations, nine funders and four training institutions;
  • WD created a Skills Development and Training Community of Interest with Prairie Federal Council members to facilitate senior level information sharing and provide the opportunity to build awareness of departmental priorities and programming to further cooperation through in-depth discussions of key files, related issues and areas of potential collaboration; and
  • WD developed a pilot Skills Development and Training Engagement Framework to strengthen its consultation and collaboration with other federal departments, resulting in a coordinated pan-western effort to seek relevant input from other federal departments.
Priority Type Program(s)

Aboriginal Economic Growth

New

Business Development and Innovation

Community Economic Growth

Policy, Advocacy and Coordination

Summary  of  Progress
  • WD approved six new projects in support of this priority area, totaling $10.3 million under WDP in 2014–15. These projects will increase skills development and training, employment readiness, and participation in natural resource development opportunities for Aboriginal people and communities;
  • WD is a signatory to the AANDC Strategic Partnerships Initiative (SPI) – a national program to support Aboriginal participation in the economy, with a particular focus on opportunities in natural resource sectors.  In 2014–15, WD became the representative for federal Regional Development Agencies on an interdepartmental group chaired by AANDC to support decision-making on SPI projects and annual budgets;
  • As a member of the new SPI – West Coast Energy  interdepartmental committee, a total of six projects, representing an investment of over $4.0 million in SPI funding, has been approved for WD delivery.  The six SPI projects allow WD to build on its portfolio of projects, as they are generally earlier stage economic development projects that would not normally be funded under the WDP;
  • WD worked with AANDC and the Manitoba Institute of Training and Technology to coordinate the event "From Membertou to Manitoba."  The one-day workshop allowed participants to explore Aboriginal partnerships with the private sector.  The event was attended by approximately 90 participants representing First Nations, economic development agencies, and others; and
  • WD provided funding to the Aboriginal Business Services Network and Aboriginal Community Futures organizations to enhance access to business information, services and training.
Priority Type Program(s)

Trade and Investment

Ongoing

Business Development and Innovation

Policy, Advocacy and Coordination

Summary  of  Progress
  • WD approved 16 projects in support of this priority area, totaling $18.6 million under WDP in 2014–15. These projects will assist western Canadian SMEs to engage in international business, both in North America and emerging markets, strengthen the capacity of Western Canada's trade corridors to move goods, services and people in and out of the region, and attract foreign investment to Western Canada;
  • WD approved the establishment of a Foreign Trade Zone Single Window Task Force in both Calgary and Edmonton to strengthen their capabilities as an inland port and attract foreign investment;
  • WD carried out significant outreach to western stakeholders and other partners, such as provincial departments, regional and municipal trade agencies, industry associations, research institutes and post-secondary institutions, to broaden its client base and raise awareness of WD's priorities and objectives with respect to Trade and Investment; and
  • In 2014–15, WD also strengthened its engagement with key federal departments and agencies engaged in Trade and Investment. WD carried out consultations with the Department of Foreign Affairs, Trade and Development, Agriculture and Agri-Food Canada, and Export Development Canada among others to enhance alignment of WD's investments in Trade and Investment with the Government of Canada's Global Markets Action Plan.
Priority Type Program(s)

Revitalization of the Western Canada Business Services Network (WCBSN)

New

Business Development and Innovation

Community Economic Growth

Summary  of  Progress
  • The WCBSN provided a total of 160,320 business information, advisory and training services to SMEs in rural and urban areas, as well as $85.0 million in loans that leveraged an additional $96.8 million. The impacts included 5,047 jobs created or maintained through lending and 1,583 businesses created, maintained or expanded through lending;
  • The Canada Business Network (CBN)  provided over 108,000 business information, advisory and training services across Western Canada in 2014–15;
  • WD made significant progress in 2014–15 to revitalize Community Futures (CF) governance and accountability and to encourage alignment with WD and federal priorities. As a result of CF revitalization, most CFs were offered new three year contribution agreements which provide them with planning and financial stability for a longer time frame and reduced administrative burden;
  • WD launched and finalized the Women Entrepreneurs' Initiatives' (WEI) revitalization process to modernize governance and accountability and improve performance and alignment. All WEI organizations have implemented revitalization measures and have new three year contribution agreements;
  • As part of WCBSN revitalization, WD launched a review of the Francophone Economic Development Organizations, Aboriginal Business Services Network, and Entrepreneurs with Disabilities Program; and
  • In 2014–15, WD transitioned to a third-party delivery model for CBN services across Western Canada, entering into operating agreements with the Saskatchewan Regional Economic Development Authority and the World Trade Centre in Winnipeg. As a result, the CBN now has a consistent delivery model across the West.
Priority Type Program(s)
Federal Defence Procurement New

Policy, Advocacy and Coordination

Business Development and Innovation

Summary  of  Progress
  • WD approved one project for $50,000 in support of this priority under WDP in 2014–15. Funding was provided towards the Western Canada's Defence and Security Symposium (WestDef) which took place in Calgary in July 2014.  The event was organized by the Western Canadian Defence Industries Association to raise the profile of western SMEs in the sector with international and national defence companies.
  • WD worked as a business facilitator to raise awareness of federal defence procurement projects and to connect western Canadian stakeholders with opportunities in the global supply chains of prime contractors and key partners. This included hosting the Western Innovation Forum in April 2014, which connected Western Canada's aerospace, defence and marine industries with partnerships and business opportunities, hosting an industry day on the Canadian Surface Combatant in British Columbia in August 2014 and organizing federal Value Proposition Guide engagement events in Vancouver and Winnipeg in January 2015;
  • WD represented western Canadian interests in the development of the federal Defence Procurement Strategy. This included leading a coordinated regional development agency  advocacy effort to ensure that bidders on defence procurement projects are required to submit Industrial and Technological Benefits (ITB) plans that demonstrate regional industry engagement across Canada. WD also participated on the Evaluation Committees that reviewed and assessed the ITB plans, including the new rated and weighted Value Proposition component under which bidders compete on the basis of economic benefits to Canada associated with defence procurement projects; and
  • WD supported collaborative trade and investment opportunities for Western Canada as part of a unified Canadian presence at international tradeshows, including events such as Eurosatory and the Ministerial led mission to the 2014 Farnborough International Air Show.
Priority Type Program(s)

Managing for Excellence in a Changing Environment

Previously Committed to

All programs

Summary  of  Progress
  • WD implemented Client Relationship Management (CRM) to support program delivery and reporting. WD's CRM is being used to deliver the online application components of the WINN and WDP programs;
  • WD completed implementation of the lifecycle approach to managing its Grants and Contributions projects which involved having the same staff member assigned to a project from conception to completion, ensuring better continuity in developing and monitoring funded projects;
  • Starting in May 2014, WD moved to a CFP process for not-for-profit proponents. The CFP is a fair, open, and transparent business process where by the Department conducts a comparative analysis of applications and makes investment decisions against a merit-based rating system. This approach strengthens WD's responsiveness to economic trends and industry needs and ensures alignment with WD and federal plans and priorities;
  • WD implemented GCDOCS, the new Government of Canada electronic documents and records management solution to assist in meeting information lifecycle management obligations. GCDOCS will help the Department to better manage projects, content and share information; and
  • WD is continuing to collaborate with Canadian Heritage to build a common CRM solution for the Regional Development Agencies to enhance program delivery efficiency and services.

Risk Analysis

Key Risks
Risk Risk Response Strategy Link to Program Alignment Architecture

Weak competitiveness and low productivity in Western Canada

  • Supported projects under WDP and WINN that improved business development and innovation through activities such as the adoption of sound management business practices or technology, training of highly qualified personnel, investment in applied research and technology, and prototype demonstrations.
  • Hosted Western Innovation Forum 2015 to facilitate policy discussions and support innovative business-to-business interactions in defence/ aerospace sector.
  • Strengthened engagement with western SMEs, industry associations, research institutions and other government departments to promote innovation and skills development and training in Western Canada.

Business Development and Innovation

Small domestic market and increasing global competition for western Canadian businesses

  • Approved 17 new projects in Trade, Investment and Market Access with $18.6 million in WD funding.
  • Established two Foreign Trade Zone Single Window Task Forces to attract foreign investment to inland ports.
  • Strengthened engagement with other federal departments and agencies to enhance alignment of WD investments with the Government of Canada Global Markets Action Plan.

Business Development and Innovation

Western Canada is a significant contributor to the overall Canadian economy, accounting for 38 percent of Canada's real economic output in 2014. Western Canada's economic growth of 3.2 percent in 2014 outpaced the national average of 2.4 percent. Economic growth and prosperity in Western Canada continues to be largely resource-driven and the West has benefitted from prolonged periods of high demand and prices for commodities. Towards the end of the year, however, parts of the western Canadian economy lost momentum, as the impact of significantly lower oil prices started to dampen activity. Weaknesses in other commodity prices such as natural gas, coal, copper and potash have also contributed to the slowdown. While the West's natural resources provide a strong foundation for future economic growth, the resource-driven growth has masked a number of fundamental challenges facing Western Canada's long-term economic prospects.

Compared to their international competitors, businesses in Western Canada suffer from weak competitiveness and low productivity, due in part to comparatively low levels of investment in research and development and slower rates of adoption of new technologies and equipment. This is partly due to low levels of risk capital financing observed in Western Canada. Innovative start-up firms in the West face greater challenges in accessing sufficient financing for technology commercialization priorities; this funding gap is particularly pronounced for early-stage firms. In 2014–15, WD invested in projects and activities that helped businesses increase their productivity and competitiveness through the development, commercialization and adoption of new technologies and business processes.

Western Canadian businesses also face the challenge of a small domestic market and increasing global competition. Expanding trade and market opportunities for western Canadian businesses is an important component of economic prosperity. In order to remain competitive in a global economy, western Canadian businesses will need to increase their presence in international markets, participate in global value chains and attract foreign direct investment. Enhancement of transportation infrastructure will help improve the efficiency and competitiveness of western Canadian SMEs in foreign markets.  In 2014–15, WD worked with western Canadian SMEs, industry associations and research institutions to improve access to global value chains, strengthen international partnerships and encourage foreign direct investment, in order to enhance access to international markets for western Canadian products and services.