Nova Scotia: A New Gateway to the Asia-Pacific Region
The world economy and modes of transportation are evolving in ways that present Nova Scotia (population: 915,000) with unprecedented opportunity. The Asian and Indian economies are booming and, increasingly, goods from these economic powerhouses are coming to North America in ships that are so large few ports can handle them. Nova Scotia is an exception. Its harbors can handle these vessels and, for India and most of Southeast Asia, Nova Scotia is the closest landfall on the North American mainland via the Suez Canal.
According to Nova Scotia Premier Rodney MacDonald, "Nova Scotia is in a strong position to capitalize on this emerging opportunity. Proximity to markets; deep, ice-free waters; and excellent rail, truck, marine, and air connections are just some of the reasons Nova Scotia is the best and obvious route as a gateway to North America and a pivotal link in the global transportation system."
Nova Scotia is also one day closer to major northern European markets than any other mainland North American port. Its ice-free Port of Halifax is the only North American East Coast container port naturally deep enough to handle the ultra-large vessels that will soon be common in the world's shipping fleets. Halifax can double its container traffic with the capacity it currently has available. Melford International Terminal Inc. plans to build a $325 million container facility in the Strait of Canso. What's more, geographically the province is two hours closer by air to Europe than any other North American destination.
Still, Nova Scotia doesn't bill its advantages strictly in terms of trade. More than 50 core life sciences firms involved in research, development, manufacturing, customization, assembly, and policy consulting are located there. Halifax-based Dalhousie University's medical and health facilities attract more than $100 million a year in research dollars. In September 2002, Nova Scotia's Brain Repair Centre performed the first tele-mentoring robotic neurosurgery at a distance of 400 kilometers. This long-distance procedure, between Halifax, Nova Scotia, and Saint John, New Brunswick, was a first in the world. Meanwhile, the Bedford Institute of Oceanography is the largest center for ocean research in Canada and the third largest of its kind in North America, employing approximately 650 scientists.
By 2009, Nova Scotia will be the most connected jurisdiction in North America with broadband Internet access available to all Nova Scotian homes and businesses. The province's information and communications technology industry was the fastest growing in Canada in 2006, with a 5.4 percent growth rate. Additionally, Nova Scotia's strong industry base in aerospace, defense, and related sectors has generated in excess of $600 billion in revenue annually. Finally, the offshore Sable Island area is the fourth-largest natural gas producing basin in North America, supplying markets within the province, in New Brunswick, and in New England.
Newfoundland and Labrador: Where Oil Is King
For Premier Danny Williams, it was news for the ages. In the summer of 2007, Newfoundland and Labrador's provincial government had finally nailed down an agreement with industry partners to develop the offshore Hebron-Ben Nevis oil field - all but guaranteeing billions of dollars in new revenues for the province's coffers and private enterprise. "Today marks a historic day in Newfoundland and Labrador, as we enter into a new era of offshore oil development with unprecedented benefits to the people of our province, including taking real and meaningful ownership of our resources, in the form of equity and a new super royalty regime," he declared at the announcement.
Specifically, the Memorandum of Understanding with ExxonMobil Canada, Chevron Canada, Petro-Canada, and Norsk Hydro Canada, provided the province with a 4.9 percent equity position in the 25-year-long project (purchased for C$110 million). It also sweetened the long-term royalty arrangement, furnishing the government with 6.5 percent of net revenues (after industry cost recovery and return on initial investment) on a per barrel oil price of US$50 or more. Beyond this, the deal ladled substantial and lucrative industrial benefits across the province: the construction of a gravity-based structure (GBS); extensive fabrication (with the exception of the utilities-process module, and subject to the availability of sufficient skills and labor); front-end engineering and design (FEED), especially with respect to the GBS; detailed engineering; and project management. And, for the first time in modern memory, this province of 730,000 people is poised to post a near billion-dollar budgetary surplus as it struggles to figure out what do with all the petro-bucks sloshing around its public coffers.
In fact, the province has spent considerable effort over the past several years diversifying its economy away from traditional fisheries to cold ocean research, biotechnology, marine remote sensing, and, of course, oil and gas engineering, exploration, and precision manufacturing. Over the next two years, the provincial government will invest more than $6.5 million in, among other things, a new Newfoundland and Labrador Research and Development Council, which will develop and deliver a province-wide R&D strategy; ocean technology sector development, which will include the release of a strategy to increase the level of private-sector activity in ocean technology; and a new fiberoptic link for Labrador.
Economically, the province could not be in a better position to execute its grand plans. In 2007, real GDP increased by 7.9 percent, driven by exports of oil and minerals and consumer and government-sector spending; the unemployment rate fell by 1.2 percentage points to the lowest rate in 26 years; and personal income grew by 4.3 percent, while personal disposable income grew by 5 percent.