By Michael Darch As seen in the Huffington Post From Beijing to Milan to Sao Paulo, The most common phrase I hear from foreign investors about the Canadian economy is “I never knew!” I remember being at a dinner and sitting beside the then new U.S. Ambassador Bruce Heyman discussing his first impressions of Canada. The man in charge of our country’s largest trading relationship remarked that he found Canada offered a surprisingly strong value proposition for investment. His advice to me was simple. Get out there and tell the story!
On May 16, Minister of Finance Bill Morneau convened the first meeting of the new Advisory Council on Economic Growth to provide insight on how to achieve national sustainable prosperity not only in the short term but also over the long haul. Canada’s largest cities must be included in this crucial country-building conversation. In the ongoing battle to attract Foreign Direct Investment (FDI), our cities must be fully utilized to tell the “Consider Canada” story on a global basis. The top 11 cities in Canada represent 52.5% of Canada's population, 56.8% of its GDP and most importantly, 63.8% of GDP growth. United under the Consider Canada Cities Alliance banner, for the last nine years these metropolitan prosperity engines have been collaborating across geographic boundaries, infusing Federal economic policy initiatives and attracting multinational investments into regional economies. Through investment missions done in cooperation with Invest in Canada, the leading lights of Canada’s economic development agencies have learned two clear lessons: First, the battleground for Foreign Direct Investment is at the city level; and second, the weapons employed are the relative strength of city ecosystems and talent. Canada has a great story to tell foreign investors, but we need to tell it and sell it more vigorously and more often. Working closely with our Federal counterparts, we can definitely do that. Here’s why we should:
A 2014 article in the Financial Times entitled “Cities Not Countries are the Keys to Tomorrow’s Economies” underlined the importance of cities and their potential to advance Canada’s economic cause. It states, “To make wise decisions, investors and policy makers need to view the world not so much as a collection of countries but a network of cities”, and“City economies now matter far more than national ones.”
The Conference Board of Canada concurs, noting, “when there is economic growth … (in an) economically leading census metropolitan area—smaller communities in the province or region grow at an even faster rate. … big cities should be targeted for strategic investment in order to produce a truly nationwide economic impact across Canada.”
Globally recognized Canadian prosperity experts like Richard Florida and Don Tapscott underscore the point that Canada’s traditional strengths in resources and agriculture are bolstered by city-based educational institutions, business ecosystems and value-added innovation.
According to the U.S.-based Brookings Institution, trade is typically discussed at the national level, but its origins and impacts are intensely local. Its Metropolitan Policy Program concludes that the largest metro areas are at the epicenter of the global economy and these metro economies attract the vast majority of jobs from foreign direct investment, and draw most of the talented foreign students that can fill critical skills gaps and strengthen core industries.
The Federal government has established increased collaboration as a guiding principal. As it takes a fresh look at strengthening our economy for the long term, it should understand that the country’s top city economic development agencies are open for business, working within currently limited budgets to set up FDI missions, business media tours, and tell the Consider Canada story to investment colleagues and CEOs in other jurisdictions. When I say limited, consider that annual Federal-Regional collaborative funding of economic initiatives have fallen from $5 million in 1997 to $3 million today. Disregarding inflation, those numbers don’t line up with the economic contribution and future potential of Canada’s cities. While the Federal government is making wise new investments in infrastructure, talent building, analysis of sector and cluster strengths and fine-tuning of prosperity-focused immigration policy, it risks the innovator’s dilemma of building a great product, and then failing to tell the world it exists. One of the first messages I learned when I went to Military College was that you lead from in front, not behind. As the new Federal Government seeks a return of Canadian prominence on the world stage, it can work with its top cities to lead. It has already addressed climate change. It is investing billions of dollars in infrastructure for our cities that will both improve the lives of our citizens and create the winning conditions to attract foreign investment. It is now time to invest the millions of dollars required to realize the collaborative power of our urban prosperity centres to build the country Canadians want and deserve. As I stated earlier, the Consider Canada Cities Alliance is very open for business and keen to accelerate conversations and increased collaborations with our Federal partners. Michael Darch is the founding President of the Consider Canada City Alliance.