Download March 2007 - NB must open doors

N.B. must open own doors
GILLES LEPAGE & FRANCIS MCGUIRE
Commentary
Published Saturday March 10th, 2007
Appeared on page A9
Building a self-sufficient New Brunswick is a bit of a do-it-yourself project.
For a variety of reasons - history, geography, a small population and the political and
financial pull of central Canada - the Atlantic provinces have always struggled to attract the
attention of investors willing to take a risk on this region.
Saint John is far removed, both physically and figuratively, from Toronto's Bay Street and its
corporate power base and the political influence that walks the cobblestones of Sparks
Street in Ottawa.
Both of us have sat around boardrooms in these and other major centres, selling investors
on the idea of New Brunswick and on the potential business opportunities that it offers.
Our efforts, and the efforts of other business executives and entrepreneurs, have brought
mixed results.
To be frank, New Brunswick is a hard sell to people who bring to the table old assumptions
and tired stereotypes.
It is time to stop knocking on closed doors; instead we must fashion our own set of keys.
Last January Premier Shawn Graham appointed us to the Self-Sufficiency Task Force. Over
the last two months we have listened and spoken with people around the province about the
challenges facing New Brunswick and the possible options for its future.
There are a lot of different opinions out there, and while we each have our own vision for the
province, there is a shared belief that reforms are needed if New Brunswick is to succeed in
the 21st century.
To spark conversation, we have released three reports that have attempted to describe New
Brunswick's current realities and offer some ideas on how to chart a path forward.
Our third report, Part III: Policy Directions, details some of the changes government will have
to make.
Chief among them is a new attitude towards business development.
We believe the Government of New Brunswick, and in particular Business New Brunswick,
has a direct role to play in attracting new companies here and nurturing the development of
local firms.
For starters, a specialized business development team must be assembled under the
auspices of Business New Brunswick. This group must be granted a degree of autonomy so
they may negotiate deals with potential investors as quickly as possible.
As part of those negotiations the team should, as an option, be able to present customized
incentive packages that might include a combination of loan guarantees, labour force training
packages, tax breaks or cash incentives.
These incentives would be determined based on the projected payback through income and
consumption taxes, the level of risk, the strategic importance of the investment and what is
being offered in other jurisdictions.
Companies that fall within one of the sectors earmarked for growth in a self-sufficiency plan,
such as energy, manufacturing and fabrication, aquaculture, information and communication
technology, environmental technologies, customer contact centres, tourism and e-health,
might warrant a higher level of support.
In Saint John, energy is an obvious choice. But so are these other sectors. For instance,
manufacturing and fabrication work will naturally roll out to serve the large energy projects
slated for development.
The region's ICT sector is well-established and poised for continued growth, as it recently did
with the opening of the renovated CentreBeam offices in Saint John's uptown, and the Saint
John Regional Hospital is already a leader in electronic health service delivery.
We must do what we can to ensure this growth continues.
That is our design for the type of key we'll need to open the door to new business
development.
Existing businesses need a different type of key, one that unlocks access to the working
capital companies need to invest in the growth of operations, including the marketing of new
products.
Last month, the New Brunswick Securities Commission hosted an important conference
during which there was a lot of talk about something known in business circles as the 'valley
of death'.
This ominous-sounding term refers to the point in a company's early development when it
has a product and an identified customer base but lacks the money it needs to market and
produce its product in order to beat competitors and make its mark.
Assisting companies, through investment tax credits, loan guarantees and sometimes direct
investment, is an important role for the provincial government to play.
As we chart our path to self-sufficiency it will be important for our local entrepreneurs and
business leaders to have access to pools of capital, skilled workers and potential markets.
This is why it is so important that they have the keys to open the right doors.
Gilles Lepage and Francis McGuire are co-chairs of the Self-Sufficiency Task Force. Their
third report The New Brunswick Reality Report, Part III: Policy Directions is available on the
task force's website at www.gnb.ca/2026.