Atlantic Canada Drives Economy With Natural Resources, ICT, Aerospace
By offering incentives and investing in technology, the provinces of Nova Scotia, Prince Edward Island, New Brunswick, and Newfoundland and Labrador are strengthening traditional and new industries to build for the future.
Mark Crawford (June/July 10)
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Nova Scotia's economic growth is forecast to recover from a 0.8 percent decline in 2009 to about 2 percent in 2010, driven by higher natural gas production and $800 million in infrastructure stimulus spending by the government. Increased U.S. demand and rising commodity prices should boost provincial exports, especially forest products and energy.
"The manufacturing sector in Nova Scotia was hard hit over the past year, but job losses have been limited due to growth in the services sector and public administration as well as the effect of significant stimulus investment," says Wright of RBC Economics. "Looking ahead, increased natural resource production and stronger international demand for these commodities should offset weaker growth in capital spending. In 2011 Nova Scotia's economy should grow by 2.9 percent."
Prince Edward Island
This island economy posted a positive, real GDP increase of 0.4 percent in 2009, with growth forecasts of 2.1 percent in 2011 and 3.2 percent in 2011. To strengthen its economy, Prince Edward Island continues to invest in high-tech sectors, especially aerospace manufacturing. Increased exports from aerospace, as well as machinery and other manufactured equipment, have limited the negative economic impact from downturns in other industries.
The province's technology sector, along with the provincial government's $510 million stimulus plan, has increased commercial construction by nearly 30 percent. Prince Edward Island is also a key player in the Atlantic Gateway Initiative, which will invest $1 billion to develop wind energy through 2013, reaching a 500 megawatt capacity.
New Brunswick's export-dependent economy suffered during the recession. But the province - which is home to big manufacturers such as Agfa, Jiffy Products, and McCain - hasn't let sluggish recovery deter its growth. McCain plans to expand into Asian markets, and Ocean Spray is building a $90 million cranberry mill in Rogersville. The mining, energy production, and transportation equipment sectors are also prepping for significant investments.
New Brunswick's economy will grow by 2.4 percent in 2010 and 3.3 percent in 2011, according to RBC Economics, driven by $896 million in infrastructure spending and personal tax cuts totaling $258 million. New Brunswick is also the first jurisdiction in Canada and North America to connect 100 percent of its population to high-speed broadband Internet.
Computer Generated Solutions (CGS), a global ICT firm, recently announced its expansion in Saint John, where it will develop Virtual Events 365, a software product that enables companies to design and deliver trade shows and learning events over the Internet. The provincial government kicked in $1.2 million in payroll rebates to help CGS hire 75 new employees.
"As a global information technology services firm, we are constantly on the lookout for top talent," says CGS CEO Phil Friedman. "We have found the talent levels in New Brunswick to be an extraordinary asset. The overwhelming support of the community has motivated us to expand our role in this province."
Newfoundland and Labrador
RBC Economics expects Newfoundland and Labrador to lead Canada in economic growth in 2010, with an impressive projected GDP rate of 4.1 percent. "Aggressive infrastructure spending, along with strong private capital investment and improvement in the mining, oil, and gas extraction and utilities sectors, should lead to a sharp rebound in growth in the provincial economy this year," Wright says.
About $14 million in AIF funds have been designated to support research in alternative energy technology, next-generation satellite imaging, ground radar technology, and geoscientific methods for predicting subsurface ground movement.
Dynamic Air Shelters, which manufactures multipurpose inflatable structures such as first-response emergency shelters, relocated its operations from Calgary to Grand Bank, Newfoundland and Labrador in 2006. In 2009 it doubled the size of its original 6,000-square-foot building. It received funding in March 2010 to build a 12,000-square-foot facility and acquire new equipment. Dynamic Air Shelters is currently working with the Canadian military to develop bullet and blast-resistant inflatable shelters to protect soldiers in the field. The Canadian and U.S. militaries are both testing its prototype.
"Both the federal and provincial governments have played a significant role in the growth of our company through equity financing and no-interest loans," says Kay Riggs, vice president of operations for Dynamic Air Shelters. "Organizations such as the Schooner Regional Development Corporation and the Burin Peninsula Chamber of Commerce have also provided networking/relationship-building opportunities, connections to local suppliers, and market-development opportunities."
Riggs says sales will increase by about 20 percent in 2010, based on
projections provided by the company's major distributors.
"We have invested significantly in a skills development program for our current employees and are completing a number of R&D projects to improve the product and move into new markets," she says.
"It is the skill and dedication of our work force that ensure our future growth and that Dynamic remains rooted in a rural Newfoundland Labrador community."