Some politicians and select media articles paint an apocalyptic picture of Alberta's state of economy and the province's prognosis for future recovery. Not too long ago, MacLean's magazine declared our economic slowdown as "The Death of the Alberta Dream."
Indeed, a sudden drop in commodity prices, structural shifts in carbon fuel production and consumption, the plummeting dollar, and Alberta's ongoing difficulty in shipping crude oil to tide water have resulted in massive job losses, outflow of investment capital and immediate drop in government revenues. These financial challenges are felt by Albertans. Yet my outlook on the future of Alberta, her economic potential and the dreams yet to be realized is optimistic. The "Alberta Dream" is far from being dead. Instead, we must dare to expand our dreams. We must tap into the entrepreneurial spirit of our business communities and researchers, and their desire to broaden Alberta's economic base.
Alberta is more complex than just oil and gas.
I often say that the Stone Age didn't end because our predecessors ran out of stones. It ended because they discovered bronze.
Granted, the oil and gas industry has long been the province's golden goose. With proper investment, paralleled with sensible regulatory regime and rebound in commodity prices (which is starting to occur), Alberta's oil industry's recovery is bound to continue. Regulatory stability and predictability will be key. After all, it wasn't the presence of Alberta's expensive and difficult-to-extract oil alone that attracted the industry here in the '70s — oil sands also existed in Saskatchewan and elsewhere. It was the collaboration of purposeful and stable government policies and the private sector's investment and perseverance that allowed Alberta, and de facto Canada, to flourish.
But Alberta must look beyond oil and gas. I often say that the Stone Age didn't end because our predecessors ran out of stones. It ended because they discovered bronze. The multibillion-dollar questions are: What will be Alberta's bronze? Where does our economic future lie?
Carbon tax can fuel 'Made in Alberta' tech
Alberta will continue to energize the world, but must also become the epicentre for research, development and commercialization of new technologies in emission reduction, "green energy" generation and pipeline construction, monitoring and maintenance technologies. Alberta's post-secondary institutions and private-sector researchers have already shown leadership on this front, yet this activity could be multiplied through the creation of a collaborative applied research and commercialization institute, akin to Germany's Fraunhofer or Helmholtz institutes.
With current structures in place, Alberta and Canada are lagging in applied research and commercialization. Our intellectual property laws are outdated. Our inflow of angel capital pales in comparison to other developed countries. Our patents expire and die on university shelves. But it doesn't need to be so.
With portion of the proceeds of the new $3-billion carbon tax, funding can be set aside and leveraged against private investment for research and commercialization of "Made in Alberta" technologies. With the utilization of a "third-party" institute, collaboration between private and public sectors in investment, research and commercialization of new patents is bound to flourish without compromising our schools' academic independence. Applying carbon tax revenues toward innovation would not only meet our government's focus on stewardship of environment, but it would also be a significant driver towards diversification of our economy.
Alberta can feed the world
Agronomists agree that within the next few decades most countries in the world will consume more food than they produce and Canada will be unique in its ability to export surplus food. Alberta, obviously, plays a major role in Canada's agricultural production. Moving forward, however, we must ask ourselves an important and familiar question: Are we going to export raw resources, or are we going to upgrade and refine our agricultural products in Alberta?
Food processing is non-labour intensive, high value, sustainable and green, making it a perfect fit for Alberta.
When asking myself that question, I often think of a $7 box of Kellogg's Cornflakes, containing three cents worth of corn, cardboard and plastic. If Alberta was so lucky as to supply Kellogg's with all three raw resources, we would have generated three cents, and $6.97 would have been realized by others in the supply chain outside of our province. That must stop! If Alberta is to position itself to feed the world, we must create the required conditions for investment in the food processing and packaging industry. Food processing is non-labour intensive, high value, sustainable and green, making it a perfect fit for Alberta.
Considering Alberta's future in food production, one can not omit the virtually untapped potential stemming from our carbon capture and storage (CCS). Following in the footsteps of European Union producers, releasing of CO2 into greenhouses has resulted in robust development of year-round production of fruits and vegetables in a climate normally not conducive to such agricultural activity. Alberta has all the prerequisites to develop such an industry as well.
Alberta, the 'Smart Province'
There is yet another asset in Alberta that we have been benefiting from for decades, and if properly restructured, funded and promoted, it could become an even bigger economic driver for Alberta — education. Alberta, because of our geographic location, sparse population and labour cost, is unlikely to become a heavy manufacturing hub. Our destiny lies in innovation and commercialization of new ideas. We must focus on educating inspired, entrepreneurial and innovative citizens, we must attract such individuals from elsewhere and we definitely must create conditions to retain them in here. We can be the "Smart Province."
Our post-secondary institutions have made Alberta proud, but in order for them to become academic powerhouses and bigger economic drivers, deliberate steps must be taken to allow them to elevate themselves to an international elite status. Current funding models are appropriate for growing undergraduate education institutions, but they do little to intensify research, graduate and post-graduate work. Campus Alberta is uniquely positioned to be able to provide Albertans with superior undergraduate education, but also become a hub of internationally competitive research in medicine, engineering, humanities, agriculture and more.
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At this point in time, we can pray for another oil boom (and we should), but we can do so much more. Instead of partisan bickering and proliferating of the negative image of Alberta's economy, and by doing so further weakening investment confidence in our province, I challenge us all to identify our path to future prosperity.
It's time for an Alberta Economic Forum to identify where our future economic fortunes lie and what concrete steps must be undertaken to put us on that path. It's time for Alberta government to heed to sound economic advice. It's time to roll up our collective sleeves and, instead of romanticizing about some Alberta Advantage of the past, discover our new advantage — our new Bronze, perhaps even Golden, Age.
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