A public discussion on economic development

I appreciated the opportunity to be on a panel discussion with Terry Seguin for a full hour today along with the indefatigable Larry Shaw from Ignite Fredericton and Stephen Lund from ONB.  Because they are using the podcast format now they can expand the conversation for those that want more – and Terry says the uptake has been quite strong.

I think it is important to have these discussions about economic development circa 2019 and try to ensure that as many New Brunswickers as possible have an understanding of what it is and what it isn’t – then they can make an informed decision based on facts.  They still may not agree with what is happening but at least it will be based on facts and not politically motivated hyperbole.

Speaking of politically motivated hyperbole I put forward my long held conviction that we need an economic development plan that transcends the four-year political cycle.  Bernard Lord’s Prosperity Plan gave way to Shawn Graham’s Self-Sufficiency Agenda which gave way to David Alward’s plan which gave way to Brian Gallant’s Growth Plan which has given away to the Higg’s plan, which according to Lund, is close to being announced.

This uncertainty related to direction has also impacted economic development system. We’ve had many different provincial economic development incarnations including BNB, INB, ONB, Department of Investments and Exports, now we have a Minister in charge of Economic Development and Small Business.  Each time there was a period of many months and even years before the new government decided what to do creating a lot of uncertainty.

And we have more uncertainty regarding local economic development.  I estimate that about 30% of the population  is not covered by a formal local/regional economic development department or staff – and 80% or more of the geography of New Brunswick.  At one point we at least nominally had regional economic development agencies covering the whole province.

We have an example that could be used.  The previous government’s climate change plan came out of an all party committee of the Legislature so when the government changed they basically kept the same plan.  We might be able to do this with economic development as well. Develop a 10-year economic development plan for the province but with all-party input.  Then if government changes hands it is more likely that we will get stability.

Beyond the economic development system, we still really haven’t agreed on what we want from economic development activities.  Some want a focus on one or two big industries, others prefer to talk about sectors, many like to talk about supporting small business.

I prefer bottom up, grassroots economic development supplemented by provincial level focus on larger opportunities.  The key for me is opportunities – as I have been saying on these pages for years.  If St. Stephen needs a dentist because there is enough demand for one – they should develop a business case document and then shop that case to potential dentists who might be interested in setting up there.  If we have a few dozen opportunities for tourism investment on the Bay of Fundy we should  build the case and then go talk to potential entrepreneurs and investors.

The idea that the market has perfect information and if there are opportunities entrepreneurs will step in is just to borne out by the facts.  I now believe this is fundamental to successful economic development. Nalcor, the natural resources development Crown Corp. in Newfoundland and Labrador, spends millions and millions of dollar each year on seismic testing and analysis to determine what minerals and resources might be under the ground and waters.  They then give this information to prospective developers to help them understand the potential.

In New Brunswick for the most part we wait for the private sector to make those investments.  Why? Isn’t it in the public interest to better understand what resources we have and to then share that information with potential investors?

There are (and have been) economic developers who agree with my view on this and, in fact, have shaped my view.  The now retired Frank Tenhave engaged me to help develop the concept of an energy park in the Sussex area (well over a decade ago now).  His idea was simple.  The natural gas was starting to flow, too  much just for Potash Corp. and the proponent was looking for new markets.  They ended up building a long pipe and shipping the gas into New England but Frank’s idea was to attract large firms that needed cheap natural gas to Sussex.  With the right legislation, the natural gas could be sold to local customers at or close to the wellhead price – ensuring the gas provider received its return on investment – but free of all the transmission and other charges.

Sounded like a good plan to me. New Brunswick would have a new, relatively unique asset and could sell the concept far and wide.

There was zero interest from government in the concept.  The pipe was built and the gas was shipped out to be used elsewhere. Obviously there are a number of broader factors to be considered but the general concept was basically dismissed out of hand.

Happy that Terry Seguin and CBC have a format now that makes it easier to go deeper. I hope he does this more often.

1 thought on “A public discussion on economic development

  1. Interesting read. My work revolves around creating a few changes in the economic landscape in Atlantic Canada without being affiliated with a political party. Perhaps we should put our heads together!

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