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Diversification

Diversification: "building a broader economy"

Diversification"Build a broader economy"

 

Over the last three decades, the West has led Canada's economic growth. The western economy has long been rooted in our natural resources and agriculture. Our industries and jobs are more diverse today than they have ever been. However, these sectors still account for a large share of our economy.

Source: Statistics Canada

Boom and bust cycles are taking their toll. When commodity prices are high, resource-rich provinces such as Alberta and Saskatchewan have strong job creation and investment. However, there is a trade-off. In 2014, oil prices began falling sharply, plunging Alberta into recession. The impact was similar in Saskatchewan, where low potash and uranium prices were already hurting investment and growth. Tens of thousands of high-paying jobs were lost—and not just in the resource sector. Lower revenues have strained government finances, putting pressure on services such as health care and education.

Alberta and Saskatchewan's growth is three times more volatile that the average for all provinces, mainly due to their higher dependence on resource sectors. Overall, British Columbia and Manitoba have more diverse industries and employment. However, communities and regions in both of these provinces also face major challenges when local mines or forestry mills close due to low commodity prices.

Now is the time to diversify our industries and build a more resilient economy. One where innovative businesses grow, while western Canadian families and their communities thrive. Exciting opportunities are being explored across the West. We must work together to spur growth in new sectors, while also transforming our traditional strengths.


Accelerating Innovation in Alberta's Oil Patch

 

Grow West spotlight

Supercharging Digital Innovation

As part of the Innovation and Skills Plan, the Government of Canada challenged businesses to work with other innovation partners to transform their sectors.

 

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Based in Vancouver, British Columbia, the Digital Technology Supercluster is doing just that. More than 200 partners, including industry leaders, start-ups, universities, and researchers, are working together on digital solutions for some of the most pressing challenges in our resource, healthcare, and manufacturing sectors.

With more than $150 million in federal funding, the Supercluster has announced its first round of projects. For example, TELUS Health, GenXys, LifeLabs, and Genome BC are working together on a new digitally integrated system that helps doctors prescribe the right drug to the right person at the right time.

The next phase of investments will help prepare Canadians for the jobs of tomorrow by growing their digital skills. This will include projects that foster the talents of Indigenous Peoples, women and other underrepresented groups.

Bold ideas from the West will spark new innovations across the country and improve the lives of Canadians. The Supercluster aims to grow Canada's GDP by $5 billion and create 13,500 jobs over the next decade.

Grow emerging sectors

The West is home to clean technology firms that produce world-leading energy efficiency, wastewater, and bio-fuel products. Vancouver, Calgary, Edmonton, and Winnipeg are hubs for digital technologies, including artificial intelligence, e-commerce, and online media.

Western Canadians want to grow these and other emerging sectors. They see the value of a more diversified and innovative economy. However, key challenges remain for companies pioneering new technologies and services.

While Canada is ranked as one of the easiest countries to start a business, the same cannot be said for growing larger companies. Canadian firms tend to remain small, with only one in a thousand firms crossing the 100-employee threshold each year.

 

Western Canadians must work together to connect our innovators and entrepreneurs to the capital, talent, and partnerships they need to grow.

 

The Government of Canada is helping emerging sectors to grow. For example, the Accelerated Investment Incentive is encouraging innovative businesses to expand and adopt new technologies. Targeted Regulatory Reviews and the resulting Regulatory Roadmaps have been developed for high growth sectors. This includes updating outdated regulations, providing clear guidance tor industry, making use of digital tools, and piloting new approaches for areas such as medical devices and autonomous vehicles.

Western provinces are also supporting innovative sectors and businesses. For example, Saskatchewan's Technology Startup Incentive is helping early-stage firms bring new products and services to market and create jobs.

 

 

 

However, more actions and partnerships are needed if we want to make emerging sectors a larger part of our economy. We must find new ways to:

 

Strengthen Innovation Ecosystems

Strengthen Innovation Ecosystems

Entrepreneurs need to build connections to other businesses, funders, universities, colleges, and governments. A stronger network for emerging sectors will see more ideas being developed and brought to the market.

Support High-Growth Western Firms

Support High-Growth Western Firms

Business services need to be tailored for innovative firms, with programs that target financing gaps, export opportunities, and industry leadership. As more local businesses scale-up, they can anchor smaller firms, attract talent and investment, and have the resources to expand into other markets.

Build Inclusive Technology Sectors

Build Inclusive Technology Sectors

Indigenous Peoples, women, immigrants, and youth need better access to high-paying careers and entrepreneurship in science, technology, engineering, and math (STEM) fields. Emerging sectors that embrace inclusion will benefit from more diverse talents.

Accelerate Innovation Adoption

Accelerate Innovation Adoption

Governments should support emerging sectors and buy innovative products that improve public services. Western businesses also need to adopt technologies that help them compete.

Modernize Regulations

Modernize Regulations

Our laws and approval processes are not keeping pace with the speed of business. Governments need clearer, more effective regulations that balance growth opportunities with the public's well-being.


Accelerating Innovation in Alberta's Oil Patch

 

Grow West spotlight

Accelerating Innovation in Alberta's Oil Patch

Canada's Oil Sands Innovation Alliance (COSIA) is an industry-led partnership that is leading the way in clean technology innovations in our energy sector.

 

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Through COSIA , its members has invested over $1.4 billion to develop solutions that limit oil sands impacts related to emissions, land, water, and tailings. This has had a tangible impact. For example, at in situ operations, COSIA innovations have reduced greenhouse gas emissions by 11 per cent and cut net water use by 42 per cent, since 2012.

The organization brings together industry, governments, academia, and the public to develop and share environmental solutions for oil sands producers. For example, in 2017 the Governments of Canada and Alberta invested $20 million alongside industry support to develop the Alberta Carbon Conversion Technology Centre near Calgary. The one-of-a-kind facility is testing commercial-scale technologies that help offset harmful CO2 emissions.

Indigenous Communities Creating Resource Partnerships

Image courtesy of Suncor

Grow West spotlight

Indigenous Communities Creating Resource Partnerships

Fort McKay First Nation and Mikisew Cree First Nation have acquired a 49 per cent interest in Suncor's East Tank Farm Development, which provides a hub for receiving, processing, and shipping bitumen.

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Partnerships such as this help Indigenous communities and businesses benefit from nearby resource developments. They create jobs and procurement opportunities, while also funding infrastructure and social programs.

Transform Resource Sectors

There is strong demand for western Canada's natural resources, crops, and livestock. These sectors are highly innovative. However, we must unlock even more of their value, while also addressing environmental challenges.

For example, both crop and livestock farming are changing rapidly. Access to digital tools and other technologies are needed to keep our agricultural producers competitive. Sustainable aquaculture is also a growing opportunity for British Columbia and other parts of the West.

At the same time, petrochemical manufacturing is an example of how our energy sector can become more value-added. Similarly, our vast metal and mineral reserves have applications for solar panel, wind turbine, and electric vehicle manufacturing.

Transportation bottlenecks, higher production costs, trade uncertainty, and regulatory burdens are making the West's resource sector less globally competitive. Only 13 per cent of business leaders agree that Canada's regulations are efficient.

Most western Canadians favour continued development of our resources, but they want it done responsibly. Made-in-the-West solutions are constantly being developed that make our oil and gas, mining, forestry, and agricultural production both cleaner and more productive.

 

Western Canada must continue to lead the way.

 

Diversification

With over $150 million in federal investment, the prairie-based Protein Industries Supercluster is unlocking new agri-food innovation. More than 100 partners across the prairies are working together to add value to our crops and tap into growing global demand for quality food products and ingredients. By embracing transformative technologies now, the West will continue to lead in areas such as plant genomics, crop data, and food safety. This initiative will add $4.5 billion to Canada's GDP and create over 4,500 jobs.

Diversification

The Government of Canada is also supporting the transformation of our resource sector through the Clean Growth Program, which is investing $155 million over four years into clean technology projects for the energy, mining, and other resource industries.

Diversification

Budget 2019 announced over $250 million to help Canada's forestry sector innovate and grow. The Calgary-based Clean Resource Innovation Network (CRIN) also received $100 million to reduce oil and gas producers' environmental impacts, including reducing water and land use, as well as improving wellsite remediation.

Diversification

The Business Development Bank of Canada has earmarked $500 million through its Energy Diversification financing stream to help small oil and gas firms weather the current market uncertainty. The Government of Canada is also positioning the energy sector for the future by providing nearly $100 million through the Strategic Innovation Fund for new petrochemical projects in Alberta's Heartland.

Diversification

The western provinces are also taking action. For example, Alberta's Petrochemical Diversification Program is providing up to $1.1 billion in royalty credits for new manufacturing plants that will turn natural gases into plastics, fabrics, and fertilizers

 

 

In order to speed up the transformation of our resource sectors, we must:

 

Strengthen Innovation Ecosystems

Invest in Cleaner Resource Development

Further industry-led research and development is needed to reduce environmental impacts from our energy, mining, and forestry sectors.

Strengthen Innovation Ecosystems

Capture More Value for our Products

Western Canada mostly exports raw, unrefined commodities. Industry needs to develop more innovative energy, food, mineral, and forestry products. Meanwhile, governments should create the conditions that enable value-added production to thrive. There is also an opportunity to explore new value chain opportunities for our resource sectors.

Support High-Growth Western Firms

Embrace Technologies that Increase Productivity

Emerging technologies can also help our resource and agricultural sectors increase their productivity. Our farmers and resource professionals should embrace new ways of doing things, such as digital tools and processes.

Build Inclusive Technology Sectors

Grow Regional Economic Partnerships

Resource sector projects offer tremendous economic potential for many rural and remote communities. Stronger community involvement increases local benefits. There needs to be more participation of Indigenous businesses and organizations in natural resource projects.

Next Steps

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