In Québec and in Canada, there has been a noticeable trend in the past few years on focusing on new legal and financial frameworks for mining projects. In Western Canada, it’s Alberta and the Enbridge project that retains most of the federal government’s attention, and in Québec, it’s the “Plan Nord”, with multi-billion initiatives announced.

With vast natural resources left unexploited, it’s natural and easy to explain the strategy. Why not — Canada has been built historically with its forests, water, mineral resources easily exploitable and sent to industries to the South. What’s worrying though is that there are no parallel plans to help develop new technologies. Of course, governments will mention funding to EDC, tax credits, BDC and other entities such as the Notman House, but it’s always presented as another “N-th” measure, in the same basket as nice measures to help single families or whatever new (insignificant) policies to satisfy various local and business communities. Moreover, all of those measures are initiated by politicians who frankly were never seen in technology and entrepreneurial circles and are only giving funding to structures or events that were seen once or twice in newspapers headlines. There are no risks or no innovative measures that show expertise & braveness and will mobilize hearts&minds.

We’re missing here a honest, strong and ambitious plan that can leverage existing resources such as great universities, good technology companies (startups and large companies alike), business networks, and entrepreneurial programs, that can all put Quebec and Canada at the forefront in the development of new technologies.

For interesting parallels, Chile’s case is interesting. The country’s development is largely based on its natural resources (mining, fisheries etc.). Its legal and financial framework for the mining industry made it an attractive destination for mining companies, one of the most advanced countries in the industry. It’s still a developing countries though, and everyone there knows that natural resources exploitation is not sustainable. It’s finite, you are adding little value to the chain, and it creates strong inequality in income distribution. You are also taking away resources that future generation cannot use. What’s interesting though is that for the past two years, the country has been developing aggressively the StartUp Chile program, with the announced objective of making Chile as a top center for startups. Entrepreneurs from all over the world (Canada included) are attracted to the country, they stay from 6 months to 1 year, recruiting and developing their companies there, and also participating in building Chile’s digital future. They are also offered funding at the end of the program. The program has been receiving worldwide recognition in the media and amongst entrepreneurial circles.

What I see is that Québec and Canada wants to focus the bulk of its effort to compete with the Chile of the 90s, and meanwhile countries like Chile are definitively putting a foot in the 21st century, competing with other centers such as Tel-Aviv, NYC, London or the Silicon Valley.

See here for instance the new program of the progressist (provincial) party “Option Nationale”:

The advertised policies are “nice” and good-hearted, but once again, the focus is on natural resources, a #1 policy. I can only imagine that they discussed it for hundreds of hours, researching what’s done elsewhere to finally prone nationalization of natural resources. The liberal party of Québec (or PQ) is not much better, planning to give away hundreds of millions of dollars to mining companies, spending an unbelievable amount of resources (time & money) to make the “Plan Nord” a reality in the next 5 years.

Honestly, what happens if China decides to slow down manufacturing, thus lowering worldwide prices of natural resources? What if the USA decides to open up again their mines, lowering prices of natural resources, thus making Jean Charest’s plan a joke? What if there’s a strong recession in Europe and global demand goes down? Quebec and Canada will experience the same problems experienced by African countries. It’s only years and years later that you discover that your scientific ecosystem, technological, infrastructure (telecoms) are years behind other fast-paced countries and you’ll be forced to “import” at a high price talent & top technology from those other countries.

Currently, the country still enjoys fast Internet. Startups are born, a few thrive and conquer markets worldwide. Engineers are being trained. But Canada is not anymore #1. It was in #1 in Telecom 8 years ago, now South Korea, Russia, Japan, pretty every other developed country has faster and cheaper Internet. In the startups world, there’s been a few successes, but most, if not all startups are systematically bought by US companies for their team and their patents. RIM is KO’d somewhere in the ring and we’re still waiting if they’ll recover before the countdown. In the TSX exchange, most, if not all investors are allergic to tech titles.

If there are no new ambitious and strong policies initiated now, we’ll see in a few years Canada #1 in oil, copper, gold and a few other areas, and technology will be a thing in the past. I know I don’t want to work in a mine. Do you?

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I am an electrical engineer interested in disruptive ideas. Founder of MontrealTechWatch, organizer at MTLNe ...



  • http://www.facebook.com/profile.php?id=1120842578 Misterr Jean

    Thumbs up!

  • sirtakid

    Great piece Heri. I couldn't agree more. There is a need to fund innovation at both universities and private companies, and not simply through ''real-estate” or ''headcount'' tax credits . We lack major R&D initiatives such as the EU frameworks and those sponsored by federal agencies in the US (DARPA, DOE…) , or even by small countries like Singapore.


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