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Ontario’s Resilient Northwest Banks on Education, Public Sector and Ring of Fire Mining Developments – by Livio Di Matteo

Livio Di Matteo is a Professor of Economics at Thunder Bay’s Lakehead University where he has taught since 1990.  His research has explored the sustainability of provincial government health spending, historical wealth and asset holding and economic performance and institutions in Northwestern Ontario and the central North American economic region. He writes and comments on public policy and his articles have appeared in the National Post, Toronto Star, the Winnipeg Free Press and Thunder Bay Chronicle-Journal. Mr. Di Matteo has started an Economics Blog at http://ldimatte.shawwebspace.ca/

For an extensive list of articles on this mineral discovery, please go to: Ontario’s Ring of Fire Mineral Discovery

According to the Stockholm Resilience Center (www.stockholmresilience.org), the concept of resilience refers to the capacity of a social-ecological system to withstand perturbations from various types of shock and to then renew itself afterwards.  In other words, if a system is resilient, it can deal with change.  The forest crisis in Northwestern Ontario was a major economic shock to the region’s economy that resulted in massive employment losses and yet if one looks at the region’s economy and especially its major center – Thunder Bay – one cannot help but notice the resilience of the economy. 

Thunder Bay, which has seen three of its four pulp mills close and numerous sawmill job losses over the period 2003-2009, has witnessed increases in many indicators of economic activity suggesting that the economy has been able to adapt to the shock of the forest sector loss.

The relatively resilient economy in Northwest Ontario is being driven by three broad forces: the continued transition towards a knowledge based economy in the region, the expenditure on public sector infrastructure and the growth and development of the mining sector in the region.  The knowledge economy in Northwestern Ontario is being spearheaded by the development of the Thunder Bay Regional Health Sciences Centre (TBRHSC), the Northwestern Ontario School of Medicine (NOSM) and the research work of the Thunder Bay Regional Research Institute (TBRRI). 

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Rio Tinto News Release: Rio Tinto Announces New Global Centre for Underground Mine Construction in [Sudbury] Canada

26 November 2010

Rio Tinto has announced a key strategic partnership in Canada, teaming with world leading researchers to create the Rio Tinto Centre for Underground Mine Construction.

The new Centre will be based at the Centre for Excellence in Mining Innovation (CEMI) in Sudbury, Ontario, and will focus on innovative rapid mine construction and ground control for mining at depth.

Rio Tinto is investing C$10 million over five years in the centre, completing a suite of five global long term Rio Tinto research centres around the world.

The work with CEMI will assist Rio Tinto’s development of new excavation systems through The Mine of the Future™ programme, focusing on significantly improving the construction and operation of underground mines.

As part of this programme, Rio Tinto will conduct a full scale performance verification trial in 2012 at Northparkes’ copper and gold mine in New South Wales, Australia, as the first of three new underground excavation systems.

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Industrial Parks in Greater Sudbury – What is Happening? – Dick DeSefano (October 3, 2010)

Dick DeStefano is the Executive Director of Sudbury Area Mining Supply and Service Association (SAMSSA). destefan@isys.ca

Summary: SAMSSA looks at the supply of industrial land in the face of complaqints that the City is not “Business Friendly.” Information suppled by the Greater Sudbury Development Corproation suggests the city is not supporting industrial development well.

Since its inception in 2003, SAMSSA has advocated for upgrading infrastructure and services in present and future industrial parks for its members. Recently, a number of complaints were forwarded to the SAMSSA office after an article in the Sudbury Star highlighted one company’s complaint about having to pay for what it believes are fundamental services (sewer, water and paved roads) covered by their signifance commercial taxes.

This article and subsequent SAMSSA News Updates to members triggered a number of requests for our office to investigate what was happening especially in the potential for upgraded roads, water and sewer on both Fielding Road and Elisabella Street.

The Greater Sudbury Development Corporation (GSDC) were very helpful and provided an ongoing study that is looking into these issues.

It is not uncommon in election year to hear that a another study will look at this problem. However, past experience has proven that once a new Council is elected, this study will lose out to other projects because of costs or lack of commitment. There are more votes won by paving high traffic roads than supporting the millions of dollars needed in an industrial park upgrade.

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Northern Miner Editorial – BHP Blows US$800M on Failed Transactions – by John Cumming

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry. Editor John Cumming MSc (Geol) is one of the country’s most well respected mining journalists. jcumming@northernminer.com This editorial is reproduced with permission of The Northern Miner and is from the November 22-28, 2010 issue.

BHP Billiton formally withdrew its hostile, US$40-billion cash offer for Potash Corp. of Saskatchewan on Monday after the Canadian government had rejected it two weeks earlier on the grounds that it did not provide a “net benefit” to Canadians, heeding the loud protestations of Saskatchewan Premier Brad Wall and a groundswell of opposition in the province.

Of paramount concern to the provincial government was BHP Billiton’s indifference to the long-established Canpotex export-sales cartel, and the company’s willingness to drive down potash prices as it maximized mine output.

The federal government had left open for BHP a 30-day window to improve its bid, but that was just a formality, as BHP had already made many substantive concessions relating to increased taxes, vows to maintain employment levels, and commitments to remain in Canpotex for five years, and to centre its potash business in Saskatchewan.

Clearly, BHP Billiton execs spent too much time with their noses in their spreadsheets and were unable to grasp the enduring strength of Prairie populism in Canada. And BHP paid a full price for its lesson, tallying US$350 million in transaction costs for the failed bid, of which US$250 million will be recognized in the half year ending Dec. 31.

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Analysis of Vale’s $10 Billion Canadian Investment – Liezel Hill (Mining Weekly North American Deputy Editor)

Mining Weekly is South Africa’s premier source of weekly news on mining developments in Africa’s most important industry. Mining Weekly provides in-depth coverage of mining projects and the personalities reshaping the mining industry. In order to advance Mining Weekly’s objective of positioning itself as a leading global provider of mining news, a full-time correspondent is based …

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Northern Miner Editorial: Bill C-300’s Defeat

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry. This editorial is reproduced with permission of The Northern Miner and is from the November 8-14, 2010 issue.

The last week of October was a satisfying one for Canadian miners, with Canada’s parliament voting to defeat the anti-mining Bill C-300 by an unsettlingly close 140-to-134 margin.

As Canadian miners are well aware, Bill C-300 was a private member’s bill sponsored by backbench Liberal Member of Parliament John McKay, representing Toronto’s suburban Scarborough riding.

Superficially innocuous, Bill C-300, had it become law, would have given the federal ministers of foreign affairs and international trade new responsibility to hold Canadian resource companies accountable for their corporate social responsibility (CSR) practices in developing countries by submitting annual reports to the House of Commons and Senate for review.

The ministries could then sanction delinquent companies by keeping money from lending arms such as the Export Development Canada and the Canada Pension Plan.

However, the bill was so naively constructed that, as law, it would have led to a flood of frivolous, obstructionist and defamatory complaints coming in from all corners of the world from anti-capitalist agitators, shakedown artists and covert foreign mining competitors.

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Northern Miner Editorial – Political Power Play Over PotashCorp

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry. This editorial is reproduced with permission of The Northern Miner and is from the November 1-7, 2010 issue.

BHP Billiton’s $40-billion hostile bid for Potash Corp. of Saskatchewan entered a critical period in late October, as the broadly free market-friendly Saskatchewan Premier Brad Wall and his government set aside years of “Saskatchewan-is-open-for-business” talk and came out strongly against the deal.

Wall said the deal fails to provide a “net benefit” to the people of Saskatchewan and Canada in three key areas: jobs and investment, Canadian control of an important Canadian resource, and provincial revenues. He also voiced concern over the fate of the Canpotex potash-export marketing arrangement if BHP succeeds in its bid.

“Do we want to add PotashCorp to that list of once-proud Canadian companies that are now under foreign control?” asked Wall, who cast doubt on the ability of federal authorities to enforce restrictions should approval be granted with specific conditions.

“In the past decade, promises about maintaining jobs, corporate headquarters and future investment have all been broken,” said Wall. “We simply cannot take that risk with this valuable resource that belongs to the people of Saskatchewan.”

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Whither Ontario? Reconsidering a Narrative of Economic Demise – by Dimitry Anastakis

Dimitry Anastakis teaches in the Department of History at Trent University (Peterborough). His first book “Auto Pact: Creating a Borderless North American Auto Industry, 1960-71,” won the 2007 J.J. Talman Prize as the best book in Ontario history. Prior to Trent, Dr. Anastakis was a Senior Advisor in the Governemnt of Ontario’s Automotive Office, and a Fulbright Chair in Canadian Studies at Michigan State University.

Let us, for a moment, pity poor Ontario. 

The litany of affronts, indignities and embarrassments over the last two decades is long and inglorious:  Free trade agreements hoisted upon it; careening business cycles and a roller-coaster dollar; wrenching and radical changes in government; ever-increasing taxes and an end of cheap power; never-ending sporting failure and Olympic disappointment (twice); separatist movements in the North, city-state rumblings from Toronto; mayors who provoked blizzards of national mockery; massive power failures to ice storms to G20 fiascos. 

All have ruthlessly descended upon the province and its capital like a series of Biblical plagues, not to mention a real plague—SARS—in 2003. 

In the last two years, Ontario hit rock bottom.  To add insult to injury, in 2008 it was announced that Ontario would qualify for equalization.  Then, in the summer of 2009, the auto industry, the province’s industrial cornerstone, went bankrupt.  When the smoke cleared from the economic meltdown, the province’s deficit was $25 billion.  Once Confederation’s frugal accountant, the province is now derisively referred to as “Ontari-owe.”  Economically, it’s a basket case. 

Pity, however, is not so charitably given in some quarters.  For all its woes, there exist longstanding resentments of Ontario’s prosperity, built into the very DNA of Confederation.  For quite a few Canadians, Big Bad Ontario, which long lorded its exalted economic status, is finally being knocked from its pedestal. 

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News Release: Rio Tinto Creates A New $10 Million Mining Research Centre at CEMI in Sudbury, Canada

Sudbury, ON – On November 25th, 2010, Rio Tinto announced the establishment of the Rio Tinto Centre for Underground Mine Construction (RTC-UMC) at the Centre for Excellence in Mining Innovation (CEMI) located in Sudbury, Ontario, Canada. Rio Tinto will be investing $10 million dollars over five years to undertake research at the centre.

Rio Tinto is focusing on mechanized excavation including a shaft boring system (SBS) and tunnel boring systems (TBS). Rio Tinto has selected CEMI as the agent for collaborative research leadership in support of high speed construction associated with underground mine construction. For Rio Tinto, this investment reflects the company’s long term commitment to science, engineering and innovation, and is central to its approach to research partnerships. This is the fifth global long-term research centre to be established by Rio Tinto.

The Rio Tinto Centre for Underground Mine Construction at CEMI will undertake research with respect to ground and machine performance. For this purpose, prototype test sites will be instrumented to improve ground characterization techniques and to develop innovative support systems to facilitate high speed, mechanized tunnel and shaft development technologies for underground mines in highly stressed ground and at depth.

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Could Sault Ste. Marie be Site of Ring of Fire Processing? – by Ian Ross

Established in 1980, Northern Ontario Business  provides Canadians and international investors with relevant, current and insightful editorial content and business news information about Ontario’s vibrant and resource-rich North.

For an extensive list of articles on this mineral discovery, please go to: Ontario’s Ring of Fire Mineral Discovery

Bruce Strapp Exit interview

Sault Ste. Marie is well-positioned to get a share of the chromite processing from the James Bay lowlands, said its outgoing economic development head.

“The value that Sault Ste. Marie will bring to the Ring of Fire is we’ll have one of North America’s biggest steel plants,” said Bruce Strapp, who was preparing in October to take on his new job as executive director of the Northern Ontario Heritage Fund Corporation (NOHFC).

While a number of communities across the North have been vocal in getting a piece of the action to process chromite ore, the Sault has been flying below the radar, but Strapp said the city is far from being out of the loop.

Strapp said with mine development in the massive McFauld’s Lake camp more than five years away, there is no reason to blow the Sault’s horn until the site selectors show up.

“Moving forward and talking to Cliffs (Natural Resources) and saying ‘We want your business’ (makes no sense when) there’s really no business to be had yet.”

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The New “Cluster Moment”: How Regional Innovation Clusters Can Foster the Next Economy – Mark Muro and Bruce Katz (Brookings Institute)

The Brookings Institution http://www.brookings.edu/ is a nonprofit public policy organization based in Washington, D.C. One of Washington’s oldest think tanks – founded in 1916 – Brookings conducts research and education in the social sciences, primarily in economics, metropolitan policy, governance, foreign policy, and global economy and development.

Its stated mission is to “provide innovative and practical recommendations that advance three broad goals: strengthen American democracy; foster the economic and social welfare, security and opportunity of all Americans; and secure a more open, safe, prosperous, and cooperative international system.” Brookings states that its scholars “represent diverse points of view” and describes itself as non-partisan. – Wiki

The Obama administration’s FY2011 budget request (February/2010) proposed several initiatives to support American regional industry/innovation clusters. The budget request  document states, “We need to recognize that competitive, high-performing regional economies are essential to a strong national economy.” 

An except from a United States Department of Commerce, February 1, 2010 News Release states, “Competitive, high-performing regional economies are the building blocks of national growth and can benefit from smarter policies. The budget supports growth strategies based on stronger regional clusters of economic activity through funding in the Commerce Department’s Economic Development Administration, the Small Business Administration (SBA), as well as the Department of Labor with other agencies in key support roles. As part of the administration’s place-based initiative, the 2011 budget provides $75 million in regional planning and matching grants within EDA to support the creation of Regional Innovation Clusters that leverage regions’ competitive strengths to boost job creation and economic growth.”

Mark Muro and Bruce Katz have produced an excellent policy paper on the economic value of regional clusters for the Brookings Institute. The Executive Summary is posted below. For the entire policy document please click here: http://www.brookings.edu/~/media/Files/rc/papers/2010/0921_clusters_muro_katz/0921_clusters_muro_katz.pdf

EXECUTIVE SUMMARY

Twenty years after Harvard Business School professor Michael Porter introduced the concept to the policy community and 10 years after its wide state adoption, clusters—geographic concentrations of interconnected firms and supporting or coordinating organizations—have reemerged as a key tool and rubric in Washington and in the nation’s economic regions.

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Vale Closure Announcement Unacceptable – Steve Ashton (Thompsom, Manitoba MLA)

Steve Ashton was first elected to the Manitoba Legislature in 1981 for the New Democrat Party (NDP). He was re-elected in the general elections of 1986, 1988, 1990, 1995, 1999, 2003 and 2007. In October 2009, he was appointed as Minister of Infrastructure and Transportation, Minister Responsible for Emergency Measures and Minister Responsible for the Manitoba Lotteries Corporation. His daughter, Niki Ashton, is also a politician and is the New Democratic Party MP for the riding of Churchill.

Vale’s announcement that they are eliminating the surface operation here in Thompson is unacceptable.

Since the 1950’s Thompson has had a fully integrated mining operation.  The development of the refinery and smelter were integral parts of the 1956 agreement that established Thompson.

In good times and in bad times our community and our province have always been there to work with Inco, now Vale. In the process we have developed one of the best mining, smelting and refining operations in the world.

Vale’s announced shut down of the surface operations in Thompson came without any discussion about solutions with key stakeholders or the provincial government. I have never seen a more arrogant and insensitive move.

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Standard Charter PLC News Release – The World is in a Super-cycle Once Again, This Time Led by Asia

Standard Chartered PLC is a leading international bank, listed on the London, Hong Kong and Mumbai stock exchanges. It has operated for over 150 years in some of the world’s most dynamic markets and earns more than 90 per cent of its income and profits in Asia, Africa and the Middle East. This geographic focus and commitment to developing deep relationships with clients and customers has driven the Bank’s growth in recent years. For more information, please visit: www.standardchartered.com

Download “The Super-cycle Report”

London, 15 November 2010: The world is in a sustained period of high economic growth, or super-cycle, which started in 2000 and is expected to last at least another couple of decades and see the global economy reach over USD 300trn in size by 2030, up from USD 62trn today, according to a special report by Standard Chartered. The world economy has already doubled between 2000 and 2010.

The developed economies will do well through the super-cycle, but the emerging markets will do much better. As a result, the global balance of economic power will shift decisively from the West to the East, according to the report.

The key drivers

The key drivers of the super-cycle will be increased trade, especially among emerging markets, rapid industrialisation, urbanisation and booming middle classes in the developing world. The number of people living in the cities will grow to 5bn in 2030, up from 3.4bn today.

Asia will drive most of the global growth over the next 20 years, during which global output is conservatively set to more than double in real terms, having already risen more than 50 per cent in the last decade. Living standards, as measured by real per capita income, will have increased nine-fold in China and India between 2000 and 2030.

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United Steelworkers News Release – Vale Announcement Long on Propaganda, Short on Investment

RELEASE, 17 November, 2010

Vale’s latest “investment” announcement continues a public-relations campaign more concerned about image than providing net benefits to Canadian communities.

“Vale’s announcement today is perhaps the most cynical public relations exercise we have seen yet from this foreign corporation,” said Ken Neumann, the United Steelworkers union’s National Director for Canada.

“While it claims to meet its commitments under the Investment Canada Act, Vale decides to close the smelting and refining facilities in Thompson, Manitoba,” Neumann said.

“This closure will eliminate a crucial value-added component of Thomson’s mining operations, potentially killing more than 500 jobs and dealing a devastating blow to the community.

“This clearly demonstrates Vale’s lack of commitment to Manitoba. Rather than invest in its Thomson operations, Vale opts to cut 40 per cent of its workforce and wreak more havoc on Canadian working families.”

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Vale Canada’s Net Benefits – by Terence Corcoran (National Post-November 18, 2010)

The National Post is Canada’s second largest national paper. Terence Corcoran’s editorial opinion was originally published on November 18, 2010. This cannot be true. The Brazilian mining giant Vale announced $10-billion in new investment in Canada, building new facilities, opening new mines, pouring fresh capital into Sudbury. Where did this come from? For weeks now, the only thing Canadians knew …

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