Western Canada: Leveraging Resources to Maximize Growth
By honing incentives and investing in infrastructure, the provinces of Alberta, British Columbia, Manitoba, and Saskatchewan are strengthening traditional and new industries to build for the future.
"Companies throughout Alberta are executing their business plans to take advantage of conventional oil and gas and emerging oil sands markets," says Lynn Wyton, senior director, Advanced Industries Unit of Alberta Finance and Enterprise's Industry Development Branch. "In addition, newer niche markets are presenting themselves as sectors as green building products and environmental products and services increase in importance." The agency says a four-point plan instituted by the province to promote economic stability focuses on cutting government spending; drawing on its CAN$17 billion in emergency savings to protect the programs and services Albertans rely on; continuing to invest in public infrastructure to support jobs and the economy; and promoting investment in Alberta and maintaining a competitive business environment.
The investment climate is boosted by a low and competitive tax structure. For example, Alberta continues to be the only province that does not levy a provincial retail sales tax, benefiting both individuals and businesses. Alberta's Premier Ed Stelmach has recently declared there will be no new taxes or tax increases.
Businesses continue to benefit from Alberta's low fuel tax - which, according to Alberta Finance spokesperson Jason Maloney, is the lowest among provinces - as well as the lowest general corporate tax rate and the third-lowest small business rate among provinces; this supports the growth and development of both small and large businesses. Businesses and financial institutions also benefit from not having to pay capital taxes or payroll tax. Alberta also is the only province that does not have a capital tax on financial institutions.
Recent projects include an announcement by Imperial Oil, Exxon's Canadian subsidiary, of an $8 billion Kearl Lake project to mine bitumen. Also, Williams Energy Canada has recently announced plans to build a $300 million pipeline to ship natural gas liquids from northern Alberta to its processing facility 420 kilometers (261 miles) away.
Energy isn't the only industry taking advantage of the opportunities in Alberta. The North Carolina-based home improvement retail chain Lowe's recently filed a development permit application for a large home improvement and garden center in the province.
"Our province's economic success is tied to our ability to bring investment to our province from the global market," says Maloney. The nine international offices - one in Washington, D.C. - facilitated more than 3,300 networking sessions and participated in almost 200 trade shows in 2007 and 2008 to promote trade and investment in Alberta.
Iain Black, Minister of Small Business, Technology and Economic Development, reports that last year, the private sector invested through venture capital programs in 57 new companies, including 31 information technology firms, 15 new life sciences companies, seven energy and environmental technologies firms, three traditional companies (such as consumer and business services and products), and one specialty chemical and advanced materials firm. "Our $90 million B.C. Renaissance Capital Fund is focusing on four key technology sectors: information technology, new media, clean technology, and life sciences," says Black.
One of the fund's venture partners recently led the $10.5 million financing of Ostara Nutrient Recovery Technologies Inc., a Vancouver clean tech company that produces environmentally friendly fertilizer. The Innovative Clean Energy Fund (ICE) supports clean energy technology projects - such as solar, geothermal, tidal, wind, and bioenergy - at the point where their technical and/or commercial viability can be demonstrated in real-world operating conditions.
Adding 300 jobs to the region's growing technology sector, Microsoft Corporation officially opened its first Canadian development center in a Vancouver suburb in March. Pixar Animation is building a 20,000-square-foot facility in Vancouver to produce its short features. Amir Nasrabadi, the studio's general manager, says that the firm chose Vancouver because of its English language speaking capability, its match with the Los Angeles time zone, and the attractive production tax credits. The city's numerous animation studios and quality schools also promise talented employees.
In addition, British Columbia will host the 2010 Olympic and Paralympic Winter Games. As a result of the games, the Royal Bank of Canada is predicting growth of 2.9 percent in 2010, while the Conference Board of Canada, in its spring 2009 outlook, forecast GDP growth of 3.3 percent - the highest rate of growth in Canada.
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