On Wednesday, federal Finance Minister Bill Morneau presented the government’s fall economic update for 2018.
The update included several concerning the Canadian tech and innovation ecosystem. One of the most notable is a boost to the Strategic Innovation Fund, as the government calls for injecting another $800 million in capital. Of this amount, $100 million will focus on providing support to the forest sector. The government first announced its $1.26 billion Strategic Innovation Fund in July 2017 to go towards helping companies with research and development and scale.
The government noted that it will build on its $400 million Venture Capital Catalyst Initiative by earmarking money to cleantech firms. The government plans to contribute $50 million on a cash basis towards increasing venture capital available to cleantech companies under VCCI.
The government is proposing an Export Diversification Strategy that will invest $1.1 billion over the next six years to help Canadian businesses export to new markets.
To deal with ongoing concerns with regulations from the business community, the government plans to create an External Advisory Committee on Regulatory Competitiveness, which will help Ministers and regulators identify regulatory changes by working with the business community. Canada’s tech community has been outspoken about regulations it feels are stifling innovation in the past, including concerns that the government’s plan to tax passive investments—which was amended after outcry—would affect businesses’ ability to prepare for downturns.
On this note, the government is proposing up to $11.4 million over five years, and $3.2 million per year ongoing towards creating a Centre for Regulatory Innovation. While details on how this will work weren’t immediately available in the update, the government said in its update, the government said broadly that it wants to explore the use of physical spaces, sandboxes, and pilots to ensure that the regulatory system can keep up with the needs of technology.
As the update comes just over a month after NAFTA replacement USMCA was finally approved, the government made a point in its update to acknowledge an over-reliance on US export; according to the government, Canada’s exports to the US account for three-quarters of all goods exports, while 99 percent of Canada’s oil is exported to the US. “Canada must adapt its approach to trade. For decades, Canada has lost global trade market share, and for too long Canada has been reliant on trade with a single partner: the United States,” the update reads. “Given the uncertainty created by recent global trade disputes, the Fall Economic Statement announces the Government’s intention to significantly bolster export opportunities for Canadian businesses, and diversify Canada’s overseas trade,” the report reads.
The government is proposing an Export Diversification Strategy that will invest $1.1 billion over the next six years to help Canadian businesses export to new markets. The Strategy will focus on three key components: investing in infrastructure to support trade, providing Canadian businesses with resources to execute their export plans and enhancing trade services for Canadian exporters. The government last signalled its focus on export diversification with the creation of a Minister of Small Business and Export role.
“We’ve already negotiated agreements like the one with the European Union and with Asia-Pacific countries, and we want our businesses to be accessing—of course, the United States—but also these international markets,” Small Business Minister Mary Ng said in an interview with BetaKit in October.
Access the full economic update here.
Photo by Stuart Isett via Flickr.