Canada’s Budget for Edmonton Businesses

Last night at dinner, the discussion on the federal budget was deafening. Everyone was focused on the escalating debt and the deficit, all with spirited and good intention. But beyond the big looming debt number, not one business owner knew much about the details … the details of which are actually quite interesting.

Edmonton-based businesses have never cared much about the Federal Budget, and I totally respect the reasons why. Budgets have been for government folks, easterners, institutions and non-profits. Why would the federal budget come up in conversation, aside from taxes? What does the budget have to do with my business making money? How is the budget relevant to our day-to-day free-enterprise lives.

Part of me would love to continue asking those questions. But part of me knows that the world is changing and it’s not the smartest strategy to be left behind.

Every Edmonton-based business should read Budget 2017. I don’t mean read to simply find their new personal or corporate tax rates. But read it to understand the underlying policy and directional changes that will shape our country for the next decade or more. Budget 2017 doesn’t do much for the energy sector or for our current economic downturn, but the budget is unusually specific about the path forward and the emerging sectors that are expected to move Canada’s economy ahead.

Read it and engage; or ignore it and be left behind. Because in it, Budget 2017 has significant positive implications for Edmonton – Canada’s 5th largest, youngest, fastest growing municipality – that is being recognized as a major hub for new federal investment.

Beyond the significant support for affordable housing and predictable long-term investment for transit and infrastructure, as successfully championed by Mayor Don Iveson, this budget focused on building our economy through the solid combination of innovation and job creation. Of specific interest to Edmonton-based businesses should be:

  • $400 million over three years to be made available through the Business Development Bank for a new Venture Capital Catalyst Initiative to increase last-stage venture capital available to Canadian entrepreneurs (who submit proposals);
  • $1.4 billion in new financing support for Canada’s cleantech sector (equity finance, working capital and project finance) to promising clean technology firms who want to grow and expand;
  • $125 million to fund a pan-Canadian Artificial Intelligence collaboration between Montreal, Toronto-Waterloo and Edmonton, with UofA’s AMII (Alberta Machine Intelligence Institute) recognized as one of the leading programs in the world;
  • $950 million over 5 years to support a small number of business-led innovation “superclusters” that have the greatest potential to accelerate economic growth;
  • 10,000 new Co-op positions for STEM (science, technology, engineering, math) students;
  • Priority sectors for investment will include Advanced Manufacturing, Agri-food, Cleantech, Digital Industries, Health and Biological Sciences and Clean Energy Resources;
  • $7.8 million over two years to implement a new Global Talent Stream under the Temporary Foreign Worker Program, as part of the Global Skills Strategy;
  • No changes to capital gain taxes or taxes on stock options, which will benefit the tech sector;
  • $50 million over two years for teaching initiatives to help children learn to code; and
  • $37.5 million per year funding made permanent to Destination Canada, Canada’s national tourism marketing organization, to continue its strong collaboration with industry partners to maximize the impacts of its marketing campaigns to draw in more tourists from abroad.

Now, I’m typically one of the first people to call for balanced budgets. However, if a fiscal stimulus and low interest rates are required to keep our national economy on a positive growth curve, which they are, then these are the areas that have the ability to stimulate a long-term change to business innovation and competitiveness which we so desperately need across the nation.

The programs listed above are very much in line with our priorities at EEDC, through our Investment & Trade, Tourism, Startup Edmonton, Tec Edmonton, Edmonton Research Park and Shaw Conference Centre teams. And these are our teams that connect with local businesses on a daily basis to help Edmonton-based companies understand and benefit from these new programs and sources of funding.

Fiscal stimulus and support programs are needed across the country for our businesses to grow and evolve, adopt new technologies, access new talent and new markets and improve competitiveness. It is part of a larger transition we need to be embracing, otherwise others will and folks like my dinner guests will be left behind.

Please take time to become informed, and see each of these programs as opportunities for your business. Once informed, please connect with us at EEDC to help connect you with some of these new opportunities.

http://www.budget.gc.ca/2017/docs/plan/toc-tdm-en.html

http://www.budget.gc.ca/2017/docs/bb/brief-bref-en.html

http://www.budget.gc.ca/2017/docs/speech-discours/2017-03-22-en.html

Global Intention

After university, I decided to spend a year abroad – something every student should do before they enter the workforce and inherit the conventional view of possibilities. I headed for Japan, fascinated with how this country had emerged post-WWII as a technological and economic giant. I got lucky and was asked to teach at an elementary school just south of Osaka, and this is what I learned:

Every student in Japan is taught at the elementary school age that they live on an island and that the only way to prosper is to produce goods and services for export and trade. That foundational understanding drives their whole curriculum and policy environment, and results in an entire country that is globally oriented.

Pause. Think about that for a minute. Think about the global awareness, alertness, competitiveness and connectedness that would result from multiple generations becoming globally engaged. What if:

Every student in Alberta is taught at the elementary school age that they live in a land-locked province and that the only way to prosper is to produce goods and services for export and trade. That foundational understanding would then drive the entire curriculum and policy environment, and result in an entire province that is globally oriented and competitive.

This is emerging as my new mission, core to our economic strategy, that would result in a totally new mindset, and that would be an organizing mechanism for driving wealth and prosperity for generations to come.

And that is what we need, a new mindset. For far too many years we have been far too complacent – thinking, building, trading, spending and squabbling within our provincial borders. We have developed a regional mindset, far too reliant on government, and far too disconnected from high-growth markets around the world.

The only sustainable diversification strategy is the diversification of revenue by geographic market – becoming global players – being engaged in emerging markets like China, India, Africa and Brazil that will dominate global growth in the next 20 years, as well as across higher-growth markets in North America.

Our economic future must be global – outside of Alberta. And we need to turn our attention to shaping our international competitiveness by educating our kids properly, building and maintaining economic infrastructure, investing in research and product development, pursuing international trade and investment relationships, and aligning multi-level government resources to connect our businesses to opportunities in international markets.

Japan had the plan, the commitment and the urgency.

We need to do the same.

Talk to the Customer

When sales were down and anxiety was rising, my ol’ boss George Goeders at Procter & Gamble used to say to me, “You can’t solve it by sitting in here, get out there and go talk to the customer.”

Words to remember. Thank you, George.

That is why this past week was so refreshing. During continued decline of the stock market and energy prices, our two Edmonton Liberal MPs, Randy Boissonnault and Honourable Amarjeet Sohi, were busy out talking with customers – the right thing to do.

Eight roundtables held at the Shaw Conference Centre plus three others exposed the ideas and concerns of business owners, union employees, entrepreneurs, youth, academia, local government and local families. The MPs came well prepared, the attendees came well prepared, and the dialogue was rich, focused and on point for today’s realities.

And these weren’t the “I’m from the government and I’m here to help” kinda consultations. These were well prepared, well facilitated, well organized engagement sessions where there was an openness to new ideas and an understanding that no one knows all the answers.

What was interesting was that although our MPs desperately want to help and roll out some magical program that solves everyone’s economic problems, there was a greater understanding that the real role of government is really to create the environment where entrepreneurship and investment can best flourish.

Keeping taxes low, eliminating unnecessary regulation, opening new markets, promoting the Canadian brand, reducing the size of government and hiring entrepreneurial thinking people into the public service all create that environment where people want to invest and take risks … things that consistently employ people and create wealth.

It is a powerful motivator when government leaders are promoters of economic growth and prosperity, and powerfully concerning when they sit behind closed doors alone trying to figure out how to squeeze more tax from the system.

Getting out and taking to customers always results in better solutions.

Thank you, Randy and Amarjeet for kicking off your leadership with the right approach.

Structure Follows Strategy

It has been a long time since Alberta had a Ministry of Economic Development & Trade, and it is long overdue. The announcement by Premier Notley last Thursday brought cheers from many across the province, as we can now establish focus and resources towards our most pressing economic issues:

  1. Building a culture of risk-taking and entrepreneurship in businesses big and small;
  2. Developing revenues, trade and investment from beyond our borders;
  3. Unlocking the value of our resource assets in mutually beneficial ways; and
  4. Leading an innovation system that is relevant and respected across Canada.

We have been talking about these four simple priorities for years as part of our provincial strategy; however, the ministerial structure never followed the strategy and past ministries lived through endless leadership changes and budget uncertainty.

This was a much needed change and, when led by a strong Minister, Deputy Minister and Premier’s Advisory Committee on the Economy, I believe we are now off to a great start.

The old models of economic development, diversification and innovation have not brought success or change, and I look forward to working with this new ministry to compete and win in today’s marketplace.

I am often hard on our government because I have high expectations. This is a timely and prudent move, and I compliment this kind of thoughtful stewardship.

I look forward to helping bring back our excellence.

Why Are We Waiting?

There’s a nervousness growing on the streets and in the conversations happening in our coffee shops across Alberta. There is concern and angst among people who are typically risk-takers, adventurers and entrepreneurs.

And it’s becoming infectious. And it’s becoming concerning.

Alberta has a long history of an unusual economy – filled with highs and lows, droughts and floods, journeys and discoveries. It’s been a land of opportunity between periods of hardship, and our culture of camaraderie and cooperation has prevailed when times were most tough. And we’ve always fought through it, together.

Optimism is a key virtue of living here, as is hard work. There is no room for entitlement, and pointing fingers and complaining leaves you sitting very alone. If something needs fixing, we fix it. If something needs doing, we do it. And if someone needs help, we help them. It’s pretty simple.

So why has developing a budget and a policy framework become so difficult?

In today’s world of economic uncertainty, our individuals, families, businesses, farmers and non-profits all need some help, some guidance, some direction in terms of what they can expect … such that they can plan and make decisions that positively affect their future.

Instead, we’re playing politics and waiting for a federal election before taking care of our own?

That’s certainly not the culture that’s made us successful. That’s certainly not how we build our province. And that’s certainly not any form of leadership.

People expect more. And when you can taste fear hovering in the air … people need action.

Let’s see some leadership and some action … please.