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Industry Clusters for Economic Prosperity

Ottawa to kick off $950-million innovation ‘supercluster’ competition – by Sean Silcoff (Globe and Mail – May 24, 2017)

https://www.theglobeandmail.com/

OTTAWA — The federal government will kick off the centrepiece of its innovation agenda Wednesday by officially launching a program that will disburse $950-million to as many as five “supercluster” initiatives geared toward creating high-paying jobs in fast-growing sectors.

Initial applications for the funds will be due July 21 from industry-led consortiums in eight high-potential sectors: advanced manufacturing, agri-food, clean technology, digital technology, health-bioscience, clean resources, infrastructure and transportation. Shortlisted applicants will have until Oct. 20 to submit detailed proposals, and the government plans to select the winners by year’s end.

“This initiative is about government partnering with industry, academia and communities to build on our strengths to develop the economy and the jobs of the future,” Innovation, Science and Economic Development Minister Navdeep Bains said in an interview.

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Key measures aimed at energizing Canadian high-tech clusters, like those in Ottawa-Gatineau – by James Bagnall (Ottawa Sun – March 23, 2017)

http://www.ottawasun.com/

Perhaps we should be a little insulted. There’s a section in Wednesday’s federal budget that highlights how a multitude of measures aimed at accelerating innovation are supposed to work.

The government wants us to create innovation superclusters — “dense areas of business activity” capable of attracting the very best talent and companies from around the world. To give us an idea of what these look like, the budget lists four urban areas that have already achieved this distinction: California’s Silicon Valley, Berlin, Tel Aviv and the Toronto-Waterloo corridor.

A nod in the direction of the capital region would have been nice. While it’s true Ottawa and Gatineau long ago lost the distinction of being the planet’s most important supercluster in matters of telecommunications technology, the cities’ innovators are mounting an impressive comeback.

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Morneau’s ‘clusters’ may not be an economic silver bullet – by Jennifer Wells (Toronto Star – March 22, 2017)

https://www.thestar.com/

The finance minister points to clusters as the basis for his innovation agenda. But studies show they may not be effective tools for public policy.

Budget day. Astute in the photo-op department, Finance Minister Bill Morneau will be sporting his ethically-sourced, made-in-Mexico Poppy Barley lace-ups. Poppy Barley is Edmonton based, so the finance minister gets a gold star for supporting Canadian business.

The custom shoe company was founded by sisters Justine and Kendall Barber, so two gold stars for championing women entrepreneurs. And Poppy Barley is transparent in its supply chain, so let’s give the finance minister full marks for ingenuity. How successful Morneau will be in selling his innovation agenda, however, is a different order of business.

This time last year the finance minister’s “Growing the Middle Class” budget highlighted a four-year, $800-million commitment “to support innovation networks and clusters” as part of that agenda.

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Governments can’t find the ‘secret sauce’ of Silicon Valley – by Alex Whalley and Trevor Tombe (Financial Post – November 30, 2016)

http://business.financialpost.com/

“We should not be known for our resources,” said Prime Minister Trudeau at this year’s World Economic Forum in Davos, “but for our resourcefulness.” With that in mind, the government has put innovation policy near the top of its agenda and recently announced $800 million for a “cluster networks strategy” where Ottawa will focus innovation subsidies on particular industries and locations. Though it is receiving much attention, it may not be smart policy.

First, innovation is but a means to the end of higher living standards and productivity. Based on the most recent data from the Penn World Table (the leading source for international comparisons), Canada is about 20 per cent less productive than the United States — equivalent to a staggering $15,000 in lost economic output per person per year. Ottawa is right to focus on closing this gap.

But to improve productivity, developing new technologies ourselves is not the only way. Adopting better technologies from elsewhere has value too, but this is often neglected or explicitly inhibited. Consider municipal restrictions on Uber or Airbnb, or federal restrictions on foreign activity in telecom or airlines.

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As tech clusters spread, a fight to be Silicon Valley North – by Sunny Freeman (Toronto Star – August 29, 2016)

https://www.thestar.com/

The stretch of the 401 that connects Toronto with Kitchener-Waterloo has many hallmarks similar to California’s Highway 101.

Ooka Island is a rapidly growing learn-to-read software startup with roots planted in the red soil of Prince Edward Island. But when the Charlottetown-based company planned to get serious about bringing its product to market, it needed to expand to an urban centre close to venture capitalists, a pool of skilled labour and a broader customer base.

“Once you get to the product validation stage it is hard to be on an island far away,” said Kelly Shaw, CEO of Ooka Island. “We needed an office in Toronto so we had access to a much bigger market and a much bigger network.”

Ooka Island moved into a co-sharing space at Toronto’s MaRS Discovery District nearly two years ago. Its neighbours include other startups, advisors and investors and tech giants such as Facebook, Etsy and Airbnb.

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Mission impossible: mining suppliers to save the world – by David Robinson (Sudbury Mining Solutions Journal – August 22, 2016)

http://www.sudburyminingsolutions.com/

The mining supply sector is invisible, disrespected and dumb, but it could be responsible for saving the world

Invisible for two reasons. The first is just statistical. According to the Standard Industrial Classification, there is no mining supply industry. Firms from hundreds of industries supply the mining sector.

That is why the distinguished Institute for Competitiveness and Prosperity in Toronto failed to notice a mining supply cluster in Sudbury for the second time when it published its second inventory of Canadian clusters. They couldn’t see what Statistics Canada didn’t measure.

The mining supply sector is also invisible because it is dumb — dumb in the dictionary sense of “unable to speak.” Mining suppliers are diverse, geographically scattered, generally small and largely unorganized. Few are fully specialized in mining. They are defined in terms of the industry they supply.

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‘The Smartest Places on Earth’ – by Van Agtmael and Bakker – by Shawn Donnan (Financial Times – March 13, 2016)

https://www.ft.com/

An optimist’s guide to the rust belt revival

For years the dominant narrative about the American rust belt has been one of decline and decimation — a once-thriving industrial core turned into a dystopian wasteland by the winds of free trade and persistent undercutting by China.

But in The Smartest Places on Earth, former financier Antoine van Agtmael and journalist Fred Bakker make a courageous case for an alternative vision. What if the real story of the rust belt these days is one of reinvention? What if we ought to consider these regions “the emerging hotspots of global innovation”?

It is a courageous argument because it goes against the political grain in America. Eight years after the global financial crisis, the US is reaping the political damage of not just the crisis but also of the decades-long economic patterns blamed for hollowing out the manufacturing sector and the middle class.

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‘The Geography of Genius,’ by Eric Weiner – by Ashlee Vance (New Your Times Sunday Book Review – January 8, 2016)

http://www.nytimes.com/

In the early 1960s, the Soviet Union tried to make a version of Silicon Valley from scratch. A city called Zelenograd came to life on the outskirts of Moscow and was populated with all manner of brainy Soviet engineers.

The hope — naturally — was that a concentration of clever minds coupled with ample funding would result in a wellspring of innovation and help Russia keep pace with California’s electronics boom. The experiment worked as well as one might expect. Few people will read this on a Mayakovsky-branded tablet or smartphone.

Many similar attempts have been made in the subsequent decades to replicate Silicon Valley and its abundance of creativity and ingenuity. Such efforts have largely failed. It seems near impossible to will an exceptional place into being or to manufacture the conditions that lead to an outpouring of genius.

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MEDIA RELEASE: Institute for Competitiveness & Prosperity Report Overlooks Sudbury’s World-Class Mining Clusters

Sudbury is the Silicon Valley of underground mining research

Nickel Belt – (July 6, 2016): The Toronto-based Institute for Competitiveness & Prosperity recently issued a report titled “Clusters in Ontario: Creating an ecosystem for prosperity” that, in the opinion of industry experts, overlooks Sudbury’s vibrant mining clusters.

Industrial clusters are interrelated businesses in compact geographical regions that are supported by educational, research and government institutions which enhance economic growth, prosperity and innovation through value-added manufacturing and internal/external exports.

Marc Serré, Nickel Belt MP and a member of The National Standing Committee on Natural Resources says, “Sudbury’s dynamic mining clusters are a globally unique concentration of Canadian hard-rock expertise and innovation, unique in North America and found in very few other cities around the world. My fear is that federal and provincial policy experts and politicians will read this report and assume any requests for multi-million dollar strategic investments for Sudbury to further enhance educational or research aspects would not be warranted.”

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Toronto think-tank’s industry cluster model excludes mining – by Ian Ross (Northern Ontario Business – July 5, 2016)

http://www.northernontariobusiness.com/

Researchers at the Institute for Competitiveness and Prosperity sure didn’t do their homework in the eyes of Dick DeStefano, executive director of the Sudbury Area Mining Supply and Service Association (SAMSSA).

The influential Toronto-based think-tank released a working paper in late June highlighting five of the most impactful industry clusters in Ontario, and is recommending Queen’s Park put the right supports in place to recognize and strengthen them.

In its paper entitled “Clusters in Ontario – Creating an Ecosystem for Prosperity,” the institute focused on Windsor’s automotive industry; Toronto’s marketing, design and publishing companies; Kitchener-Waterloo-Cambridge’s “supercluster” high-tech triangle; Toronto’s financial services district; and the Niagara region’s hospitality and tourism sector.

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NEWS RELEASE: Clusters in Ontario – Creating an Ecosystem for Prosperity ( Institute for Competitiveness & Prosperity June 29, 2016)

http://www.competeprosper.ca/

This is a highly controversial report for the people of northern Ontario as it ignores the vibrant and globally recognized mining cluster in Sudbury, Ontario. In fact, the world’s most important academic on economic clusters – Harvard University’s Michael Porter – in a 1991 report titled Canada At The Crossroads, commissioned by the Government of Canada and the Business Council on National Issues, highlighted Sudbury’s mining cluster! He did not mention the hospitality and tourism cluster in St. Catharines! – Stan Sudol (RepublicOfMining.com Publisher/Editor)

Click here for full report: http://www.competeprosper.ca/uploads/WP26_clusters_FINAL.pdf

Toronto – A new working paper from the Institute for Competitiveness and Prosperity suggests that the province of Ontario could increase its prosperity through the growth of clusters and makes recommendations on how to improve the ecosystem that fosters successful clusters including the loosening of foreign direct investment restrictions and reducing government involvement in venture capital markets.

As of 2015, the prosperity gap, measured by Gross Domestic Product (GDP), between Ontario and its North American peers stood at $12,500 per capita. This prosperity gap reflects lagging productivity. It means that the average worker in Ontario produces less output (such as goods or services) than his or her North American counterparts. If Ontario wants to close its prosperity gap and become more competitive, it must address its greatest challenge: increasing productivity.

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[Sudbury] The Best Underground Technology Cluster in North America – by Dick DeStefano (Sudbury Mining Solutions Journal – May 2016)

Dick DeStefano is the Executive Director SAMSSA.

Northern Ontario Shines in Underground Technologies

Michael Denham, the new CEO of Canada’s Business Development Bank, recently acknowledged that small to medium enterprises (SMEs) represent 99.8 per cent of all Canadian companies, produce 66 per cent of jobs in the country, represent more than 50 per cent of Canada’s GDP and that we need more SMEs generating more growth to sustain our economy in an era of globalization and increasing numbers of free trade agreements.

These observations apply to numerous sectors of the economy, but are especially valid in the most sophisticated underground technology centre in Canada. The number of employees in Northern Ontario with its 500 plus mining supply and service companies employing approximately 23,000 people is double the number of people directly employed by mining companies in Northern Ontario.

Free trade agreements, which are proliferating in the global market, will be advantageous to SMEs offering sophisticated technologies that will enhance productivity. These companies are very visible in our mining cluster in Northern Ontario.

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Renewables require innovation and change of mining industry mindset – by Simon Rees (MiningWeekly.com – January 19, 2016)

http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – The future success of renewables in the mining sector will require companies to overhaul the way they think about energy and mine development, according to professional services firm Deloitte.

“When we look at mining, innovation and competitiveness, we don’t often put those things together,” said Deloitte associate partner Adriaan Davidse, addressing an audience at a recent Canadian German Chamber of Industry and Commerce renewables in mining conference.

Davidse highlighted innovation as an important value driver, as it helps attract capital and deliver alternative or new profit streams for many mining companies. Renewables played an important part within this, he said.

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China domestic demand could be driver to new commodities supercycle – by Lawrie Williams (Lawrieongold.com – November 12, 2015)

http://lawrieongold.com/

If you thought Black Friday and Cyber Monday were the peak of overhyped sales frenzy – you ain’t seen nothing yet! China’s Singles Day – an even more hyped up event from China’s online giant, Alibaba, sees even more conspicuous demand than Black Friday and Cyber Monday rolled together – and all in one day.

The event falls on the 11th day of the 11th month and this year saw sales hit an almost unbelievable US$14.3 billion – up from just over $9 billion a year earlier.

For a country the media tells us is in recession and struggling with its domestic economy – a factor blamed for many of theWest’s current ills, and for the resource sector’s poor performance in particular – this has to be a truly remarkable figure and suggests that whatever may be afflicting the country’s manufacturing and exports sector, domestic demand is running higher than it has ever been – and substantially so.

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2 Australian mines are now operating with an all-driverless fleet of trucks – by Matthew Yglesias (Vox Business and Finance – October 19, 2015)

http://www.vox.com/

The first big commercial deployment of driverless car technology is coming not in the streets of Silicon Valley but in the arid and sparsely populated Pilbara region of Australia. That’s where the large mining conglomerate Rio Tinto has rolled out fleets of all-driverless trucks at two iron ore mines, according to a report by Jamie Smyth at the Financial Times.

Rio Tinto tells Smyth that the driverless transition has improved performance by 12 percent, mainly by “eliminating required breaks, absenteeism and shift changes.”

GPS guides the trucks and allows them to deliver iron ore 24/7, 365 days a year, without the kinds of breaks and handover periods that human drivers would need. The GPS navigation system is backstopped by a team of human operators working remotely from Perth, hundreds of miles away.

Not only does this reduce the total number of humans who are needed to run the trucking operation, but it eliminates the need to employ those humans in the remote and desolate mining country.

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