I have been reading about the new crop of Brazilian firms that are investing abroad – mining, manufacturing, construction – even services.  As someone who has been travelling to Brazil for almost 20 years it has been an amazing transformation. 

In the early 1990s during the hyperinflation, I remember seeing 10,000 cruzeiro bills washing down the street in the gutter because they were almost wothless.  When we would eat at a restaurant, people would pay by cheque and it would cost 980,000 to eat lunch or something similar.

Since Cardoso and his initial policies through to Lula, that country has transformed.

I am always looking for ideas that we can graft onto New Brunswick and I like this concept of company’s building up business expertise and capacity in a local area – like New Brunswick – and then taking it outside the province and building a major global player from New Brunswick.

We have, of course, many examples of this from the Irvings to the McCain’s but we don’t have many in the recent past.  I can name 50 firms that built up something interesting in New Brunswick but then sold off to a firm based elsewhere – from engineering to manufacturing to software firms – but I have difficulty thinking of any that have started here and acquired others outside. 

I know there are examples of this.  I posted on this topic before and I got a few smaller but good examples.

But I do think that as we think about economic development we need to grapple with this idea.  Edmonton Tel (EDTel) became Telus.   NBTel became a small operating division within Bell Canada. 

Are there any policy tools, or seminars or education or mentoring or anything – that can influence this kind of ambition or is it up to the fates? 

New Brunswick is a small province so we don’t need hundreds of new McCain Foods springing up but a couple of dozen would be interesting.

8 thoughts on “Ambition

  1. I’d like to see more data; I’m wondering if it could be an access-to-capital problem. there’s a chicken-and-egg quality to these kinds of forensics: are we looking at lack of ambition, or frustrated ambition – and at what point does one give rise to the other?

  2. > Edmonton Tel (EDTel) became Telus. NBTel became a small operating division within Bell Canada.

    Actually, Telus was created when BC Tel absorbed the newly privatized Alberta Government Telephones (AGT), which had previously absorbed Ed Tel. Corporate offices are no longer in Alberta, but are in BC (Burnaby). The fates of Ed Tel and NB Tel were virtually identical.

    It’s also worth noting that Cardoso was Social Democrat and Lula was (is) People’s Party. There’s no real sign of a socialist or workers’ movement in New Brunswick. Too bad; in general, the socialists build up the economy, and the right wingers take from it.

    The only way we’re going to keep things in New Brunswick – whether it be people, dollars or businesses – is to make the province too nice a place to want to leave. There’s a lot involved in making that happen, but my observation is that the business community has steadily and successfully lobbied against these things for decades.

    Currie hit part of it when he talked about the need to educate people. And yet from this blog the main reaction was concern about people leaving. Well, yes, that’s what they do. But you have a good education system only in part because you want graduates to stay and build the province. But mostly, you have it so that the province is a good place for people to move to and raise their children.

    The only way to welcome newcomers is to make the province an attractive place to live. But the province’s business leaders have secured fire-sale rates for utilities and taxes, and oppose (cf the recent Ganong-Irving campaign against Enbridge) any attempt for outsiders to move in. Moncton got a new Molson’s brewery, and we could hear the waiting from Alpine all the way down the highway.

    The ‘Future NB’ summit will not include outsiders. It will be the small club of NB businesses – and their supporters – who have lived off New Brunswick for the past decades. They are running the province into the ground, but none of them will take responsibility, much less invest in the infrastructure to make this a desirable place.

    They plead poverty and helplessness. But their investments and development activities have been characterized by a monopolistic conservatism. Sweden, working with similar resources, got Ikea. New Brunswick provided the New York Times with pulp. Our industrialists harvested NB resources – fish, forests, coal – until there was nothing left.

    The answer today is what it has always been: invest in the people of the province, build a home people won’t want to leave, and then invite the people of the world to move here. They would, in droves. But that, it seems, is what the established order in New Brunswick fears the most.

  3. I agree with pretty much all of what was said above, but I’d like to add a caveat-in that NBers themselves can’t be let off the hook (at least not completely). It’s perfectly reasonable that businesses will look out for their short term interests. At a certain point it becomes-what is wrong with the people of New Brunswick that they will tolerate it?

    Of COURSE Irvings, McCains, etc., are not going to welcome competition. You may sometimes see companies that welcome other businesses that may compete for their workers-but not their customers. Otherwise, you better get rid of those in charge of the company quick.

    In education, things aren’t QUITE so bleak. There are bilingual schools, and as I’ve noted before, if you look at girls in english urban public schools they fair above average in INTERNATIONAL testing, according to OECD studies. David has noted before that per capita NB has more undergraduates than most provinces.

    However, where the schools fail most often is in rural areas and science. There are also specific public policy issues-NB spends less on education than other atlantic provinces as a percentage of its budget, and schools seem to be run down (some of them). However, I seem to recall that per student educational spending isn’t much different in NB than here in ontario. Of course its different in that ontario it is property taxes that pay for education, and in NB its provincial taxes.

    I just want to detract a bit from the ‘gloom and doom’ that often pervades the blog. I also disagree about the ‘right vs. left’ kind of model. Having no regulations is NOT ‘right wing’ if by right wing you mean capitalism. Capitalism was designed as a way to spread wealth, thats why the book was called ‘the wealth of nations’ and not ‘the wealth of the monarchy’ or ‘the wealth of the upper class’. It was written just as a middle class was developing.

    People would move to NB in droves if the markets were there. I very much agree that there needs to be a government focus-which means first there needs to be some kind of grassroots organization (because the government really doesn’t care one way or another)-which focuses, as this blog says, on LIVING in New Brunswick, but SELLING to the world. I would suggest that VERY few government ED workers have actually ever SOLD in the wide world, which makes them ill equipped for such a task, so like this blog says, perhaps looking at those who have done it could help.

    Just as an anecdote to this, that ‘ambition’ can come from anywhere. I was looking at sewing machines and found a guy in Toronto who basically acts as a middle man for knitting machines and accessories. Everything at his website is available in english, french, chinese, and just about every european language. He has a special site ‘for my chinese customers’. I always laugh when I see the rants against bilingualism, if anything education should be teaching nothing BUT languages. I should also note that you can find maritime fishermen who also have websites in numerous languages, and many in the resource industry export more than they sell local (some flooring companies in Fredericton). I’ve noticed that even FatKat is back on his feet and producing a couple of shows for teletoon.

    I’ve mentioned this before because it would make a VERY nice addition to the blog if occasionally there were interviews with some successful -or even unsuccessful business people. That would be more ‘positive’ and we could hear from the horse’s mouth what specific problems they are facing. And again, I’d be perfectly prepared to help in such an endevour.

  4. Brazil is a huge market in and of itself. A company established there has a large internal market – where policies favor those domestic companies – that can allow it to develop and then turn to export markets. That was the approach taken by many Southeast Asian countries a few decades ago. NAFTA and other policies make that more difficult here, plus NB does not have the large internal market. To prosper and expand to any real size, companies must be export-oriented much earlier in their development than in more populous regions.

    NB is in a difficult position; the changes that are needed will be resisted by the current large players – and there is no counterweight to their corporate power. Those current players have plenty of employees who vote, and will most likely vote to support policies they think will help them keep their current jobs. It would take a strong political leader to act against that.

  5. I agree with everything Richard says-up to the point of the last sentence. Its true that a Danny Williams or Hugo Chavez or Luis da Silva MIGHT come along, but thats a lot of breath holding. Without that, it falls on grassroots organizations to demand such policies, and that’s what the blog asked. We know the problems, is the only solution “we can’t do anything so let’s wait for somebody to come along and do it”. Or do you say “lets start doing it!”

    On that tact, it’s worth pointing out the flip side of NAFTA and free trade, which means its now EASIER than ever to be ‘export oriented’. The problem is, people don’t KNOW how to do international business. Yet even within NB there are groups of people from all over the world, yet nobody -certainly not media-has ever thought to talk to them.

    Back in my day, the only way to get funded, even government loans, was on account of how many people you employed. I know that that has changed, I know a self employed woman in the service sector who got 10 grand just because she was a woman in business. However, while there is training in the basics of ‘how to run a business’, there is little training in ‘how to GROW a business’. I suspect there are virtually NO corporate attorneys showing people how to incorporate. That brings us back to education and perhaps media exposure. WE can do ‘a little’ in that field, and I suspect that given the challenges facing Alward that he’d be MORE than a little interested in supporting any group that had some real policies.

    In case you didn’t see, Ganong is having another ‘summit’ because as he says, he’s worried that “taxes may go up”. He’s not worried about unemployment, or people leaving the province, he’s worried that he may have to pay the same amount of taxes he paid 4 years ago before the cuts. THEY will definitely have policies to recommend, but they won’t be the same as the ones the general population has in mind. I’ve read a lot of blogs and comments at CBC and IRving, and you guys definitely have the brains to get organized, but the question is if YOU can’t be bothered-who will?

  6. I’d add to the above that, if you really want to attract immigrants, then do what other regions have done to attract them.

    What attracted immigrants to southern ON over the past 40 years? The scenic beauty? The outstanding educational facilities? No, it was the chance to be prosperous – to make enough money to provide the good things to your family.

    What has attracted Asian immigrants (not to mention thousands of Atlantic Canadians) to AB over the past three or four decades? The Rockies have always been there, and I don’t think that the scenery, the cowboy culture or the nearly non-existent (until recently) support programs for non-white immigrants can explain that flood of immigration. The sudden increase in the value of energy resources in the 70s resulted in lots of capital to invest in business and lots of economic opportunity. That is what attracts immigrants.

    NB at one time in the distant past was able to attract immigrants: we had a thriving shipbuilding industry and forest products that everyone wanted. That led to investment and jobs. Immigrants helped to fill those jobs and established their own businesses. When the economy faltered as demand for those products declined, the children and grandchildren of those immigrants started to leave. Want to retain them – create economic opportunity. Let’s focus on reality, not wishful thinking.

  7. Here’s an idea. Pay top dollar for BDC or Economic Development outfit employees who have some real business training. I was absolutely shocked with the lack of competencies of my local BDC branch and even Enterprise South East. It is obvious to me that many NBers don’t know how to run a business and need consultation. This in my opinion should be a basic service that should be offered to business owners (subsidized). In a previous blog posting, the writter points to the statistics that all small start up business gets bought out and very few grow by aquiring other firms in other markets. I really think this is due to lack of expertise and lack of good consultation. Do we have access to world class financiers who have the expertise in planning out a real growth /aquisition strategy?

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