Strategic plan 2021: For a more innovative, cleaner and inclusive Quebec economy

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About this publication

Publication author : Canada Economic Development for Quebec Regions

ISBN number : 978-0-660-07591-4

Catalog number : Iu90-4/57-2017E-PDF

Publish date : March 31, 2017

Summary : The Strategic plan 2021 provides a portrait of Quebec’s economic environment and its challenges, opportunities and strengths, and then identifies action priorities and how they can be met.

Table of Contents

  1. Message from the Minister
  2. Word from the Deputy Minister/President
  3. The Plan at a glance
  4. CED's role
  5. Our environment
  6. Our objectives
  7. CED's commitments going forward
  8. Conclusion
  9. Endnotes

Message from the Minister

L'honorable Navdeep BainsIt is with much enthusiasm that Canada Economic Development for Quebec Regions (CED) presents its Strategic Plan 2021: For a More Innovative, Clean and Inclusive Quebec Economy. In sync with the Government of Canada’s priorities—and more precisely with those of Canada’s Innovation Agenda—this Plan outlines CED’s strategic directions for the coming years and maps out courses of action to achieve measurable results. It is imperative that we align our resources with these priorities and pursue our goals with a strong sense of collaboration in order to attain meaningful results.

A collaborative approach means improving synergies not only with other federal bodies, but also with the province and municipalities. It also means working closely with Indigenous people, civil society, universities and other stakeholders to support their efforts to innovate and increase productivity. CED adopted this approach in the course of its 2016 consultations, during which the public and stakeholders expressed their opinions on economic development issues and challenges Quebec regions face today.

Taking this valuable information into consideration while adapting to changing economic and technological conditions, this Plan aims to help Quebec businesses and communities fully participate in the economy of the future. It fosters economic growth through innovation, clean technologies and an inclusive approach. Strategic investments that support transition, enhance diversification and build on competitive regional advantages will lead the way towards this renewed vision for the economic development of Quebec regions.

As Minister of Innovation, Science and Economic Development, my overarching goal is to help Canadian businesses grow, innovate and export so that they can create good quality jobs and wealth for Canadians. I am confident that together, by implementing this Plan, we will put Quebec businesses and communities on the path to long-term growth.

The Honourable Navdeep Singh Bains
Minister of Innovation, Science and Economic Development and Minister responsible for Canada Economic Development for Quebec Regions (CED)

Word from the Deputy Minister/President

Manon BrassardCanada Economic Development for Quebec Regions (CED) plays a key role in delivering on the objectives of the Government of Canada, which has committed to fostering clean and inclusive growth for our country, creating quality jobs in every sector of the economy and ensuring prosperity for all Canadians.

I am therefore proud to present our Strategic Plan 2021: For a More Innovative, Clean and Inclusive Quebec Economy, which defines how CED, working with its development partners, intends to help Quebec businesses and regions rise to the challenges ahead.

The Plan sets out our strategic directions and related objectives, as well as the renewed intervention approach we will be pursuing over the coming years. It has been developed and inspired to a considerable degree by the findings of CED’s Engagement Strategy 2016, an innovative initiative that involved a series of consultations on specific themes related to economic development. (The results of these consultations are outlined in a Summary Report available on our website.)


CED is taking new measures to reach its targets and help build a more innovative, clean and inclusive Quebec economy.

As you read the Plan, you will see that it is aligned with the Government of Canada’s priorities to make innovation and science the drivers of our future economic growth, in a way that reflects the unique realities of Quebec. Its success largely rests on the work of CED’s 12 business offices located across Quebec, which not only fund projects, but also play a key networking role among the players involved in economic development. Each business office will develop a regional intervention strategy tailored to the needs of its clientele, taking into account the region’s socio-economic, demographic and geographic features. From an inclusive growth perspective, the Plan seeks to reduce disparities between the communities and, as a result, generate more equal opportunities for economic and social development.

Whether you are an entrepreneur, the head of an economic non-profit organization, a government or financial partner, or any other economic stakeholder, I invite you to take the time to read this Plan and to call upon our services so that, together, we can build a more innovative and more competitive economy in every region of Quebec.

Manon Brassard
Deputy Minister / President – Canada Economic Development for Quebec Regions (CED)

The Plan at a glance

CED's role

Canada Economic Development for Quebec Regions (CED) is among the federal departments and agencies that make up the Innovation, Science and Economic Development Canada (ISEDC) portfolio. CED is also one of Canada’s five regional economic development agencies offering programs and services tailored to each region and providing a regional strategic perspective that supports national priorities.

CED strives to further the Government of Canada’s objectives of promoting innovation, creating quality jobs and fostering growth in all regions of the country. CED does this by building on collaboration and creating synergies with communities, other levels of government, the research sector and local stakeholders.

Our mission

CED’s mission is to promote the long-term economic development of the regions of Quebec by giving special attention to those where slow economic growth is prevalent or opportunities for productive employment are inadequate. In pursuit of this mission, CED supports:

1. Entrepreneurship and business performance
CED helps enterprises get started and become more innovative, productive and competitive at the regional, national and international levels.
2. Development and promotion of regional strenths
CED promotes the mobilization of economic stakeholders and attraction of investment to help each region overcome challenges and become more prosperous (e.g. Community Futures Program (CFP), Economic Recovery Initiative for Lac-Mégantic).

Our results for 2012–2016*

The projects funded by CED contributed to, among other things:

the renewal of Quebec’s business pool with 158 new business start-up projects;
the arrival of more than 25 million tourists from outside Quebec in the province (who spent over $14 billion);
gross domestic product (GDP) growth in 16 of the 17 administrative regions in Quebec (2011–2014);
the retention or attraction of 200 international organizations and foreign enterprises and the injection of $5 billion in international direct investment;
the development of community economic facilities in the regions through investments totalling more than $40 million.

* Internal data from CED (2012–2016). August 2016 consultations.

An analysis of CED’s investments suggests ways to increase the impact of our efforts, including:

Our environment

A fast- and ever-changing global economy

Global competition continues to intensify with the rise of emerging economies, the increase in technology penetration, globalization and the growing importance of global value chains. Moreover, the convergence of environmental, financial and energy challenges will have an impact on the development of many regions of the world. This new dynamic could prompt some countries to adjust their approach to international trade, the environment and security.

In its Global Risks Report 2016, the World Economic Forum identifies a number of trends likely to affect the global economy, including:

The report also pinpoints various risks that could hinder or halt development, notably:

Economic risks

Financial bubbles, structural unemployment, illegal trade, energy price shocks

Environmental risks

Extreme weather events, natural catastrophes, climate change

Geopolitical risks

Governance problems, corruption, conflicts

Societal risks

Food crises, water crises, mass migration, social instability

Technological risks

Adverse consequences of technological advances, infrastructure and network breakdowns, large-scale cyberattacks, data fraud or theft

Source: World Economic Forum, The Global Risks Report 2016.

The World Economic Forum and international institutions such as the Organisation for Economic Co-operation and Development (OECD) are stressing the importance of guarding against these risks. To do so, regions will have to find ways of becoming more resilient, and businesses will need to take steps to better protect their data and intellectual property. It will be incumbent on economic stakeholders to keep close watch over the situation in order to adjust to such changes and seize the opportunities arising from technological advances and the digital movement. Digital technology is the driving force underlying what is being called the Fourth Industrial Revolution owing to its potential to transform societies and their ways of doing things. The growing geographic mobility of workers gives businesses access to a diversified pool of skilled labour. For cities, this expanding urbanization means more opportunities for partnership with other levels of government and the private sector.

A promising yet uneven outlook for Quebec regions

The Quebec economy in numbersReference 1,Reference 2,Reference 3

Population (2016)

8.3 million inhabitants, or 23% of the population of Canada

GDP (2015)

381 billion dollars, or 19.2% of the Canadian gross domestic product (GDP)

Employment (2015)

4.1 million workers, or 22.8% of employment in Canada

Export of goods and services (2014)

102.5 billion dollars, or 16.4% of Canadian exports

Research and development (2013)

26.2% of Canadian research and development (R&D) spending, 55.6% ($4.7 billion) of which is for industrial R&D

Regional economic dynamics

There are various ways of classifying Quebec’s regional economies. CED builds on the classification system used by the Government of Quebec, which distinguishes resource-based economies from manufacturing and urban economies.Reference 4

Resource-based economies

  • Centred on natural resource extraction
  • Sensitive to economic cycles
  • Need to diversify their economies and transform resources into high value-added products and services

Manufacturing economies

  • Possess significant economic weight
  • Affected by stronger global competition and the expansion of global value chains
  • Need to innovate and strengthen their competitiveness

Urban economies

  • Oriented toward services, including value-added services
  • Play a key role in innovation owing to the presence of world-class industrial clusters and business ecosystems that are fertile ground for innovative enterprises
  • Need to innovate and to harness opportunities in big data mining to become “smart cities”

Challenges for the Quebec economy

Regional disparities

  • Regions do not share the same characteristics or economic development potential. For example, for the period of 2011 to 2036 the Institut de la statistique du Québec (ISQ) projects demographic growth of more than 30% in Laval and negative growth of nearly 4% in Gaspésie.Reference 5
  • Basic requirements must be present for regions to develop. They need quality Internet access, the ability to rely on a skilled and competent workforce and the capacity to carry out long-term planning.
  • Economic stakeholders must evaluate local and regional issues, challenges, opportunities and assets on an ongoing basis in order to provide adapted, place-based support.

Aging population

  • In 2011, 15.7% of Quebecers were over the age of 65; by 2036, that number will have risen to 25.9%.Reference 6

Entrepreneurship and succession

  • 59.1% of small and medium enterprise (SME) owners were over the age of 50 in 2011.Reference 7
  • Only 17.5% of Quebecers looking to go into business consider taking over or buying an existing company.Reference 8
  • 30% of business owners who plan to retire within the next 10 years intend to close rather than find a buyer for their company.Reference 9

Productivity growth

  • In 2015, the hourly productivity of Quebec’s business sector ($44.10) was below the Canadian average ($49.90).Reference 10
  • Still in 2015, the hourly productivity of Quebec’s business sector was $2.70 lower than that of Ontario ($46.80).Reference 11
  • From 1999 to 2015, productivity in Quebec grew by 12.2%, six percentage points lower than in Canada as a whole.Reference 12

Innovation

  • Between 2010 and 2012, in general, 61% of Quebec companies innovated, down from 77% from 2007 to 2009.Reference 13
  • Between 2010 and 2012, 49.3% of Ontario enterprises engaged in product innovation compared with only 27.7% in Quebec.Reference 14

Internationalization of markets

  • The low Canadian dollar is raising the cost of imported parts used in the manufacturing of Quebec products and discouraging the acquisition of equipment from the United States.
  • The rising tide of protectionism in the United States and Europe is creating a climate of uncertainty for Quebec exporters.
  • Competition in Quebec’s export markets is increasing with the arrival of actors with lower production costs.

Strengths of the Quebec economy

Educated and skilled workforce

  • In 2015, 68% of Quebecers between the ages of 25 and 64 had a post-secondary diploma, which is higher than the average for Canada (67%) and the OECD countries (40%).Reference 15
  • Montréal has the highest concentration of high-technology jobs in the country.Reference 16.

Abundant natural resources

  • Quebec is the world’s 4th biggest producer of hydroelectric power.Reference 17
  • Its forest industry generates $16.6 billion in sales and employs over 60,000 people.Reference 18
  • Its mining industry ships over $7 billion worth of minerals annually.Reference 19

Vibrant high-technology clusters

  • Quebec has 39 industrial clusters.Reference 20
  • The province is the lead player in Canada’s aerospace industry, with more than 41,750 jobs, 55% of the sales and 70% of the R&D spending.Reference 21.
  • In Quebec, 196,000 people specialize in the field of information and communications technology (ICT).Reference 22
  • The province’s life sciences cluster employs over 25,390 people in 457 enterprises.Reference 23
  • Quebec companies are offering increasingly specialized products and services.

Dynamic research infrastructure

  • Quebec has 18 universitiesReference 24 and 49 college technology transfer centres (CCTT)Reference 25 working on applied research in a variety of fields.
  • Intramural R&D spending in Quebec accounted for 2.32% of the province’s GDP (2013), close to the OECD average.Reference 26

Access to numerous markets

  • Quebec enjoys a prime geographic position close to North American and European markets.
  • 115 million consumers live within 1,000 kmReference 27 of Greater Montréal.
  • The North American Free Trade Agreement (NAFTA) gives Quebec exporters prime access to a dynamic market of 460 million inhabitants.Reference 28
  • The Comprehensive Economic and Trade Agreement (CETA) with the European Union will provide new business opportunities for Quebec firms.

High quality of life

  • According to the OECD’s Regional Well-Being Index, Quebec ranks favourably in relation to other regions of the world in the areas of education, health and housing.Reference 29

Growth opportunities for Quebec

Barring a resurgence of US protectionism, Quebec is expected to remain on the path to modest recovery for the next few years, while continuing to benefit from both the economic upturn in the US and the low Canadian dollar. The higher demand for Quebec products and services should lead to increased business reinvestment.

Governance and inclusive growth

Major changes are under way in local and regional economic development governance in Quebec. In 2015, the Government of Quebec implemented new legislation to decentralize decision-making processes, giving municipalities greater autonomy. The regional county municipalities (RCMs) are now officially responsible for local and regional economic development.Reference 30 Adjustments will therefore have to be made to our practices and collaborations in the years ahead. CED will be strengthening existing partnerships and forging new ones so that it can continue to help Quebec’s businesses and regions harness new opportunities for development and growth.

Quebec can also build on its competitive advantages and leverage opportunities for economic growth, provided it does so in respect of the environment and in a way that promotes inclusion of the various groups that make up its population. Indeed, the OECDReference 31 recently indicated that, going forward, Canada will have to mobilize all available sources of labour, including its Indigenous populations, if it is to overcome the challenges of an aging workforce. The Government of Canada’s objective to promote stronger, more inclusive growth should serve as a reference in addressing these major challenges facing Quebec’s businesses and communities.

Our objectives

CED will continue supporting Quebec businesses and regions to promote their long-term economic development. The Quebec Economic Development Program—designed to foster business growth, economic development of the regions and stronger local economies—will be the main tool used to fulfil this mission.

CED will support the development of a more innovative, clean and inclusive economy by targeting four objectives aligned with several of the outcomes sought by the Government of Canada. CED’s interventions are set out in the Regional intervention strategies, which detail how each business office plans to meet CED’s priorities based on regional strengths.

1. Support growing and innovative businesses to foster a robust economy and generate high-quality jobs

Innovative economies are more productive, more resilient, more adaptable to change and better able to support higher living standards.Reference 32 - OECD

Challenges of innovationReference a

Quebec businesses have to innovate in order to grow and stay competitive. Investing in innovation helps enterprises not only raise their productivity,Reference 33 but also boost their commercial potential.

To harness this renewed commercial potential, innovative businesses must develop commercialization and export capabilities. They have to be able to adopt new business models and integrate into global value chains. To meet these challenges, they must build new organizational capabilities, continuously innovate and make ever better use of digital technologies.

Going digital forces businesses to change how they work and how they design, market, distribute, deliver and get paid for their products and services. Making these adjustments requires new skills and expertise, all the while building a culture of innovation and experimentation that allows for the emergence of new practices.

Opportunities for Quebec

Quebec has several strengths that favour business innovation, one of them being a post-secondary educated and creative labour force. The province has the highest ratio of R&D researchers in Canada, with 10.2 per 1,000 people employed. It also has a diversified economy that includes no fewer than 39 industrial clusters operating a range of sectors,Reference 46 such as aerospace, ICT, agriculture, mining and financial services. The presence of established clusters and innovation ecosystems facilitates alliances among businesses, while helping them attract international investment, become more competitive on global markets and integrate into global value chains.

In CED’s consultations, stakeholders stressed the importance of leveraging the organizations that specialize in innovation support in Quebec, and of fostering collaboration. For example, there are numerous actors promoting technological innovation in the manufacturing sector and Quebec possesses a vast network of college technology transfer centres across the province. There are also several federal players on the ground working to stimulate Quebec innovation, including the National Research Council and the Business Development Bank of Canada (BDC).

Many other organizations, such as the network of regional export promotion organizations (ORPEX), provide services to businesses in the area of innovation commercialization and export. Some government stakeholders are also active in this regard, including Global Affairs Canada with its trade missions and CanExport program, the BDC and the Government of Quebec (Ministère de l’Économie, de la Science et de l’Innovation-Export Québec).

With regard to market development, Quebec’s strategic geographic location offers countless benefits, including proximity to the US market, maritime access to Europe and new opportunities to explore in Asia. These advantages should be further optimized to better position Quebec and its businesses, especially with the coming into force of CETA with the European Union. Quebec also offers a favourable climate and power rates for the establishment of data hosting companies.

The province benefits as well from the presence of numerous incubators and accelerators dedicated to business start-ups, and from the existence of various programs and tools designed to help enterprises transition to digital (e.g. the SME 2.0 program and CEFRIO’s PME numérique).

Through the Government of Quebec’s Plan d'action en économie numérique, $188M will be invested over five years.

Along with the shift to digital, the high concentration of expertise in such fields as ICT will help Quebec carve out a place for itself in evolving niches like “cyber resilience”, a term that refers to the ability of businesses and organizations to make the transition to digital while safeguarding against cyberattacks. With the global cyber security market expected to grow by 9.8% per year between now and 2020, this will mean interesting business opportunities for Quebec enterprises.Reference 47

Lastly, with respect to ICT, Montréal International’s Profile of the Big Data Industry in Quebec (February 2016), a study conducted in conjunction with Québec International, highlights the province’s key strengths for industry development.Reference 48

Ecosystem

Cost benefit

Workforce

Quality of life

Engagement Strategy 2016 — Participants’ Ideas*

Participants to the consultations held during CED’s Engagement Strategy 2016 made a number of suggestions. They were sorted based on CED’s specific mandate and listed below.

Innovation:

1. Promote the development of innovation management skills within businesses.

2. Leverage existing organizations to support business innovation (tools and funding).

3. Promote exchanges between universities/research centres and businesses (e.g. networking activities, creation of a portal).

4. Fund technology showcases

5. Raise awareness among businesses about the importance of innovating and develop a long-term innovation strategy.

6. Organize networking activities.

7. Raise risk tolerance in direct funding to SMEs.

Innovative start-ups and growth enterprises:

8. Raise public awareness about the importance of entrepreneurship (promotion) and guide entrepreneurs through the process (incubators, accelerators).

9. Support business start-up (accelerators).

10. Make a consultancy program available to SMEs.

11. Make funds available to enterprises for major business projects: expansion and growth.

Commercialization and global positioning of businesses:

12. Accompany enterprises in their internationalization projects and support the development of the skills needed for their successful implementation.

13. Set up a platform to facilitate understanding of and access to existing programs and services.

14. Promote the tools already in place to support innovation and export.

15. Facilitate access to market studies and solutions supporting the commercialization of innovations.

Digital transition:

16. Support the development of digital skills within businesses (technical support).

17. Support business networking in partnership with local stakeholders (e.g. boards of trade) to bring about a change of organizational culture.

18. Promote new business ecosystems centred on digital technologies and the Internet of Things.

19. Provide digital support for SMEs.

* All of the suggestions are provided in the Summary Report on our Web site.

Taking action

ACTION 1: Support the start-up and growth of innovative businesses

Courses of action

Maintain support for business incubators and accelerators and industry clusters to promote the start-up and growth of innovative businesses.

In response to challenges: 1, 3 and 5

In partnership with key governmental stakeholders, help businesses in the start-up and growth phases to innovate (notably to build on their productivity and carry out projects to bridge the gap between technology and market).

In response to challenges: 1, 4 and 5

Coordinate federal support measures for accelerated-growth enterprises in Quebec in partnership with other federal stakeholders such as Export Development Canada (EDC), BDC and ISEDC and in alignment with the initiative announced in Budget 2016.Reference 49

In response to challenge: 5

Adapt the current approach to funding to support innovative, high-risk projects by start-up and growth enterprises (e.g. reviewing funding mechanisms and granting conditionally repayable contributions).

In response to challenges: 1 and 5

Legend of challenges

  1. Start-up of innovative businesses
  2. Adoption of digital information technologies
  3. Efficient innovation management
  4. Commercialization of innovation
  5. Growth of innovative businesses
ACTION 2: Support the commercialization and global positioning of businesses

Courses of action

Provide more coaching and guidance for innovative firms to help them build their capacity to commercialize, particularly through the acquisition of skills in such areas as long-term planning, in order to be well positioned on domestic and international markets.

In response to challenges: 3 and 4

Maintain support for projects that help businesses secure the certifications and approvals needed for their products and services to meet international standards.

In response to challenge: 4

Work closely with advisors in Global Affairs Canada’s Trade Commissioner Service to provide import and export firms with guidance and tools to improve their competitiveness.

In response to challenge: 4

Study the feasibility of implementing a strategy to promote the integration of Quebec SMEs in global value chains.

In response to challenge: 4

Intensify efforts to implement the federal Industrial and Technological Benefits (ITB) policy in Quebec to help SMEs better position themselves with large prime contractors and integrate into their value chains.

In response to challenges: 4 and 5

Increase promotion (via the Web and social media) of the Build in Canada Innovation Program (BCIP), a program through which the federal government supports businesses by purchasing and testing their innovative products and services.

In response to challenge: 4

Legend of challenges

  1. Start-up of innovative businesses
  2. Adoption of digital information technologies
  3. Efficient innovation management
  4. Commercialization of innovation
  5. Growth of innovative businesses
ACTION 3: Support the digital transition of CED-supported businesses

Courses of action

Partner with stakeholders to support projects aimed at boosting the digital capabilities of enterprises, particularly in the manufacturing sector. More specifically, CED could support development of:

  • the capacity of businesses to optimize use of their digital assets and review their processes;
  • the skills that businesses need to implement a digital plan and adopt technology solutions that meet their needs.

In response to challenges: 2, 3 and 5

Make businesses more aware of the importance of leveraging and protecting their data and help them acquire the tools they need to reach their objectives (e.g. big data analysis software and information security products).

In response to challenge: 2

Provide increased support for innovative firms developing digital technologies so as to promote their emergence and growth (e.g. through direct financial assistance to businesses or the funding of business incubators and accelerators).

In response to challenges: 1, 2 and 5

Legend of challenges

  1. Start-up of innovative businesses
  2. Adoption of digital information technologies
  3. Efficient innovation management
  4. Commercialization of innovation
  5. Growth of innovative businesses
Indicators Targets
Number of new growth firm projects with an “innovation” component. 500 business projects over 5 years (2021)
Number of new NPO projects with an “innovation” component. 100 NPO projects over 5 years (2021)
Implementation of the “Accelerated Growth Service” initiative. Fall 2016
Number of clients registered for the “Accelerated Growth Service” initiative 200 clients over 4 years (31/03/2020)
(25 clients by March 31, 2017)

2. Support businesses and regions that develop and adopt new technologies participating in a clean-growth economy

This objective also serves to further Objective 1 (Support growing and innovative businesses to foster a robust economy and generate high-quality jobs) and involves promoting the clean growth of Quebec businesses and regions.

Climate change is one of the biggest challenges facing all countries of the world. Globally, efforts are being stepped up to prevent these changes from adversely affecting human activity, including the economy. In December 2015, the Paris Agreement on climate change was signed by over 190 countries, among them Canada, which committed to reducing its greenhouse gas emissions by 30% (from 2005 levels) by the year 2030.

In 2015, Canada joined 19 other countries in launching Mission Innovation, a global initiative aimed at doubling government investment in clean energy R&D over five years.

Countries that lead in this area will be well positioned for the economy of tomorrow, notably in terms of competitiveness.

Portrait of Canada’s clean technology industry (2014)Reference 50

Exports

$6.6B

R&D

$1.2B

Jobs

55,600

Enterprises

775

Clean technology investmentsReference b are on the rise in many countries. Global exports of manufactured environmental goods doubled between 2005 and 2014. However, the growth rate of the clean technology sector has been weaker in Canada than the global average. The country’s share of the world market dropped from 2% to 1.3% between 2005 and 2014.Reference 51 To catch up, the Canadian and Quebec economies need to address a number of challenges.

Challenges in clean growth

Canada’s and Quebec’s innovation ecosystems offer a number of advantages for clean technology investors: a competitive business climate, world-class research and technology transfer facilities, and a labour pool of highly skilled scientists. But as important as these advantages may be, they are not enough to ensure a competitive standing for Canada or Quebec in the sector. Additional efforts have to be made to tackle the following challenges.

Opportunities for Quebec

Quebec is a Canadian and North American pioneer and leader in the implementation of environmental regulations that promote clean technologies and a business environment conducive to clean growth.Reference c Quebec and California have been working closely together since 2008 to encourage clean technology development in their respective jurisdictions. Most notably, the two signed an agreement in 2012 linking their cap-and-trade systems for greenhouse gas emission allowances.

Still, Quebec’s clean technology producers could be doing better and taking fuller advantage of opportunities in numerous sectors and niches, such as:

Engagement Strategy 2016 — Participants’ Ideas*

Participants of the consultations held during CED’s Engagement Strategy 2016 made a number of suggestions. They were sorted based on CED’s specific mandate and listed below.

1. Integrate the principles of sustainable development into government procurement practices.

2. Inform businesses on growth opportunities associated with clean technology development and raise public awareness of the issue.

3. Implement an SME development strategy in the sector.

4. Support technology showcases to promote commercialization.

5. Provide financial assistance to exporters of products and services.

* All of the suggestions are provided in the Summary Report on our Web site.

Taking action

Courses of action

Promote the development of clean technologies by supporting projects aimed at:

  • developing businesses in the sector. CED could provide funding for test beds, projects to develop new products or processes, and commercialization and start-up projects.
  • building business capabilities through the funding of organizations offering information, coaching, diagnostic, networking, structuring and technology transfer services.
  • encouraging partnership between SMEs and major contractors bound by Canada’s ITB Policy.

In response to challenges: 1, 2, 3 and 4

Support the adoption of clean technologies by funding business ecologization projects, essentially those that enable greener business practices (e.g. equipment purchases, hiring of skilled personnel, business diagnostics).

In response to challenges: 1 and 2

Fund community infrastructure projects that have a positive impact on the environment (e.g. green space improvements, integration of new clean energy sources, use of recycled materials or clean technologies).

In response to challenge: 2

Fund organizations dedicated to building a circular economy,Reference d industrial ecologyReference eor bioeconomy network or a renewable energy industry.

In response to challenge: 2

Legend of challenges

  1. Business spending on R&D, innovation and new product development
  2. Clean technology commercialization, funding and adoption
  3. Export of clean technologies
  4. Global value chains, foreign direct investment and industrial clusters in Quebec’s clean tech sector
Indicators Targets
Level of annual spending allocated to funding clean technology development and integration projects. $125M over 5 years

3. Support communities to promote their economic diversification and their participation in an inclusive economy

Communities that diversify their activities broaden their industrial base, thereby strengthening the resilience against economic uncertainties.

Communities with diversified economies are less vulnerable to economic cycles and to the consequences of globalization, technological changes and the depletion of natural resources.Reference 56 – United Nations

These communities provide enterprises with an environment that is more conducive to knowledge transferReference 57 and attract more industries that produce leading-edge technologiesReference 58 New spending in diversified economies also has a substantial multiplier effect on economic activity.Reference 59

Diversification has become a critical prerequisite for the growth, innovation and resilience of regional economies, especially those that are reliant on a single sector. That explains why CED will continue to support the economic vitality of all Quebec regions, but will give priority to regions with a greater need for diversification. To do so, CED will use its Economic Development Index (EDI) to measure and compare the economic growth level of Quebec’s 104 RCMs. The index is used in regional intervention strategies to ensure that a region’s economic development is based on its assets and its ability to capitalize on them.

Challenges in economic diversification

Opportunities for Quebec

Experience has shown that development approaches implemented by the community and based on the initiative and know-how of its inhabitants and local businesses are more effective and sustainable. Instead of reducing regional disparities, government actors should focus more on leading each region to develop its full economic potential. The OECD promotes this vision of regional economic development, and CED and the other Canadian regional development agencies agree with it.Reference 61

In light of the literature review and past experiences, economic development and diversification efforts should therefore:

Engagement Strategy 2016 – Participants’ Ideas*

Participants of the consultations held during CED’s Engagement Strategy 2016 made a number of suggestions. They were sorted based on CED’s specific mandate and listed below.

1. Proactively plan economic diversification (not waiting for crises to act).

2. Encourage collaboration, cooperation and coordination of regional and sectoral players.

3. Support regional entrepreneurship promotion and support organizations.

4. Make program terms more flexible so they adapt to regional realities.

5. Renew and effectively commercialize the regions’ tourism offerings.

* All of the suggestions are provided in the Summary Report on our Web site.

Taking action

Courses of action

Support the mobilization and joint action of regional economic development actors, particularly in communities dealing with economic diversification challenges. CED plans to:

  • play a more significant role and collaborate with local stakeholders to mobilize the players and bring them together;
  • increase its support for mobilization projects in the regions (e.g. development strategies, structured and focused action plans).

In response to challenges: 2 and 3

Invest in showcasing regional competitive advantages (e.g. support the installation of community economic facilities, promote regional strengths to attract investment and tourism).

In response to challenges: 1 and 3

Continue to encourage the development of local entrepreneurship in the communities by supporting projects that will promote business start-up and growth through regional development agencies, including Community Futures Development Corporations (CFDCs) and Business Development Centres (CBDCs).

In response to challenge: 3

Legend of challenges

  1. Enhancing the competitive advantage
  2. Access to government programs
  3. Entrepreneurial context and infrastructure
Indicators Targets
Total investments generated in regions supported by CED. $1 billion over 5 years
Direct international investments maintained or attracted in regions supported by CED. $5 billion over 5 years
Number of RCMs that have benefited from special support for economic recovery or development. 10 RCMs in the next 5 years
Spending in Quebec regions by tourists from outside the province. $17 billion over 5 years
Number of tourists attracted to Quebec regions from outside the province. 32 million over 5 years

4. Foster the participation of Indigenous peoples contributing to the economic growth of Quebec by encouraging entrepreneurship and social innovation

The Government of Canada has made a commitment to renew and strengthen the nation-to-nation relationship between Canada and Indigenous peoples, based on the recognition of their rights, respect and the establishment of a genuine partnership.

The government is determined to work in partnership with Indigenous peoples so that they can contribute fully to Canada’s economic prosperity and enjoy the same opportunities as other Canadians.

CED is working with the Department of Indigenous and Northern Affairs and the Department of Employment, Workforce Development and Labour to promote economic development and create jobs for Indigenous peoples.Reference 62 The economic development of Quebec regions will take into account their unique status and their rights over land and resources.Reference 63

Challenges in the economic participation of Indigenous peoples

The 141,915 Indigenous persons in Quebec represent 1.8% of the province’s population.Reference 64 They belong to 11 Indigenous nations,Reference g each with its own language, customs and lifestyle.

Indigenous persons in Canada, on average, have higher unemployment rates and lower individual incomes than those of non-Indigenous persons. They are also the fastest growing segment of Canada’s population.Reference 65 The unemployed Indigenous labour force will increase if nothing is done to foster their participation in economic life.

Opportunities for Quebec

CED can take action to support Indigenous participation in the economic growth of Quebec. According to the Assembly of First Nations of Quebec and Labrador, community economic development has to go through the development of the social, cooperative and entrepreneurial economies. It is also based on access to natural resources, the entrepreneurial capabilities of Indigenous people, technological innovations and access to funding and training.Reference 68

The Government of Canada’s True North Treasure Initiative-part of Quebec’s Strategic Partnerships Initiative in which CED participates-actively reviews the supply chain operations of mining companies and other industries to identify business opportunities for Indigenous people. The initiative has three specific objectives: 1) develop Indigenous human capital (labour market); 2) strengthen Indigenous entrepreneurship; and 3) enhance the value of Indigenous assets.Reference 69 Natural resource operations in northern Quebec, for instance, could provide a major business opportunity for Indigenous people, who could take part in goods and services contracting associated with those operations.

In 2014, Quebec relaunched the Plan Nord, with planned investments of $1.3 billion for the 2015–2020 period and potential opportunities for collaboration. The Plan Nord seeks to create jobs and wealth by building on the value of mining, energy, tourism, social and cultural potential in Quebec north of the 49th parallel.Reference 70 Population growth in Quebec over the next 10 years will be mainly attributable to migration, along with an increase in the number of Indigenous people. Quebec’s young Indigenous people thus have many economic opportunities.Reference 71

Twice as many Indigenous as non-Indigenous people consider entrepreneurial careers.Reference 72 – Centre de vigie et de recherche sur la culture entrepreneuriale de la Fondation de l’entrepreneurship

Moreover, the traditional skills of Indigenous people, their cultural and artistic heritage and their proximity with nature are significant economic assets for this population, particularly in the promising field of tourism.

Engagement Strategy 2016 — Participants’ Ideas*

Participants of the consultations held during CED’s Engagement Strategy 2016 made a number of suggestions. They were sorted based on CED’s specific mandate and listed below.

1. Facilitate access to capital and government support programs for entrepreneurs (lack of knowledge or complex administrative processes).

2. Gain a better understanding of community needs (consultations and information sessions on economic development).

3. Encourage sound governance in all areas: enterprises, band councils, other NPOs.

4. Develop entrepreneurial capacity and the creation of enterprises.

5. Recognize the economic value of traditional activities in the area.

* All of the suggestions are provided in the Summary Report on our Web site.

Taking action

Courses of action

In consultation with representatives of Indigenous organizations, analyze the needs of the communities and finding better ways to intervene.

In response to challenges: 2 and 3

Relax some of the program funding criteria for economic development projects with Indigenous people and provide them with tailored financial support.

In response to challenge: 2

Participate in the development of strategic partnership initiatives in Quebec by collaborating with government partners, entrepreneurs and Indigenous people.

In response to challenges: 1 and 2

Build on collaborations and targeted communications:

  • Collaborate more extensively with partners having established contacts with representatives of Indigenous peoples (e.g. communities of practice and Indigenous organizations).
  • Work with the young generation and increase access to basic funding required for business start-ups (down payment).
  • Increase the number of partnerships with Indigenous organizations and maintain existing ones.
  • Raise awareness of CED’s programs by attending meetings and events organized by Indigenous people.
  • Promote concrete examples of successes from the communities, entering into alliances with neighbouring communities and disseminating best practices.

In response to challenges: 1, 2 and 3

Legend of challenges

  1. Financial and entrepreneurial capacity
  2. Access to programs and business opportunities
  3. Diverse needs of the communities
Indicators Targets
Number of informal dialogue mechanisms between CED representatives and Indigenous community representatives or business people. 1 mechanism per region, based on the interest of the Indigenous communities concerned.
Number of new projects supporting the economic growth of an Indigenous community or business. 40 new economic development projects approved within the next 5 years.

CED's commitments going forward

To be the key federal actor in the economic development of the regions of Quebec and foster inclusive growth

Building on the Engagement Strategy 2016, CED will fulfill this commitment through a renewed intervention approach that is client-focused and where collaborators and stakeholders are consulted. CED will continue to build on innovation to implement its programs more effectively. Its approach will be based on five principles. It will be:

1. Adapted

to the needs and economic challenges of Quebec’s SMEs, regions and communities, focusing on their strengths.

2. Collaborative

based on complementarity and dialogue with key stakeholders, including regional actors, federal departments and the Government of Quebec.

3. Focused on delivery and results

from policy and program design to implementation and measurement of results.

4. Inclusive

to foster the economic participation of Quebec’s groups and communities, including those of Indigenous peoples.

5. Simplified

through the continued modernization of its ways of doing things to optimize the impact of its interventions.

Principle 1: Adapted approach

Approach adapted to the needs and economic challenges of Quebec’s SMEs, regions and communities, focusing on their strengths

What CED Heard

What CED Will Continue to Do

What CED Will Do Differently

Some regions indicated a lack of coordination and regional collaboration.

There is insufficient funding for higher-risk innovation projects.

  • Implement a strategy for each region to help businesses and the regions grow.
  • Take action and support businesses at every stage of their development.
  • Provide flexible funding tools that correspond to the realities of businesses and non-profit organizations (e.g. with respect to the repayment schedule).
  • Provide targeted support for communities dealing with unexpected situations affecting their economy.
  • CED will review the Economic Development Initiative (EDI) and associate economic indicators to obtain an up-to-date portrait of the economic situation of the regions.
  • CED will support mobilization and local and regional development plans by increasing the field presence of its business office advisors and will bring all relevant funding partner to the table.
  • CED will implement the solutions set out in the Engagement Strategy.
  • CED will review its funding tools (e.g. use of conditionally repayable contributions) for enhanced risk sharing with SMEs.

Principle 2: Collaborative approach

Based on complementarity and dialogue with CED’s key stakeholders, including regional actors, federal departments and the Government of Quebec

What CED Heard

What CED Will Continue to Do

What CED Will Do Differently

Many programs and services are available to enterprises, but enterprises have a hard time navigating through them.

Dialogue among development actors must be maintained.

  • Collaborate with Government of Quebec representatives, including funding partners such as the ministère de l’Économie, de la Science et de l’Innovation (MESI), the ministère du Tourisme and Investissement Québec.
  • Collaborate with the other federal departments and agencies on funding growth-generating projects in Quebec and developing and implementing initiatives, strategies and policies.
  • Support the implementation of federal initiatives for promoting the attraction of international direct investment in Quebec, in cooperation with Invest in Canada.
  • In collaboration with community stakeholders, help organize networking events to position SMEs with prime contractors, as part of the ITB Policy.
  • Share the results of the Engagement Strategy 2016 and continue the dialogue to learn more about the challenges faced by the regions and enterprises.
  • Build on the presence of its 12 business offices and network of partners in the regions to develop a better understanding of the challenges and strengths of enterprises and the regions.
  • Implement the Canada Business Network program, which provides a wide range of information on government services, programs and regulations.
  • CED will provide leadership and coordinate the implementation of federal priorities that have an impact on economic development in Quebec (e.g. services for accelerated-growth enterprises).
  • CED will promote synergy between its actions and those of the various economic actors by creating and participating in economic development initiatives.
  • CED will disseminate more knowledge among its external partners, including community economic development actors in Quebec.
  • CED will support enterprises and non-profit organizations in delivering their projects by helping them engage with each other and with the federal stakeholders concerned.

Principle 3: Approach focused on delivery and results

From policy and program design to implementation and measurement of results

What CED Heard

What CED Will Continue to Do

What CED Will Do Differently

Performance measurement, evidence and accountability to Canadians must be central to our work.

CED must develop effective tools for assessing the impact of its actions.

  • Contribute to the achievement of results by supporting business and regional projects that have been soundly analyzed.
  • Submit to Parliament CED’s annual performance reports and five-year activity reports.
  • CED will adapt to changes (especially economic changes) by setting targets and objectives that can be adjusted to ensure that expected results are achieved.
  • CED will produce more frequent analyses of its interventions so that its actions can be quickly adjusted and its targets reached.
  • CED will focus its efforts on priority areas to maximize the impact of its interventions.

Principle 4: Inclusive approach

To foster full participation of Quebec’s groups and communities, including those of Indigenous peoples, in Quebec’s economic development

What CED Heard

What CED Will Continue to Do

What CED Will Do Differently

It is hard for Indigenous entrepreneurs to access funding and government support programs.

In a context of increased global competition, the contributions of various groups and communities to Quebec’s economic development need to be considered.

  • Implement the Economic Development Initiative of the Roadmap for Official Languages.
  • Support projects that foster the economic development of Indigenous communities.
  • Help implement the Canadian Multiculturalism Act by supporting certain projects.
  • CED will target challenges more effectively and tailor communications to women, youth, immigrants, anglophone minority communities and Indigenous people to make them more aware of its programs (CED will do this directly or through its network of partners and economic organizations).
  • CED will train its employees to systematize the analysis of potential impact of its interventions on the various groups that make up its targeted clientele.

Principle 5: Simplified approach

Through the continued modernization of its ways of doing things to optimize the impact of its interventions.

What CED Heard

What CED Will Continue to Do

What CED Will Do Differently

Government programs need to be streamlined and simplified (e.g. eligibility criteria, approval process, repayment terms and conditions, client reporting obligations).

  • Review and simplify its processes to gain efficiencies and facilitate transactions with its clientele (e.g. online funding application form).
  • Perform risk management.
  • Modernize the government-wide common grants and contributions management system.
  • CED will offer renewed innovative service delivery by reducing processing times for funding applications and upgrading its online client interface.
  • CED will optimize its mechanisms for monitoring, performance measurement and feedback on the results obtained.
  • CED will simplify its interventions and ways of doing things by developing platforms for sharing information with other federal departments.
  • CED will be able to quickly adjust its actions by developing regional strategies that incorporate environmental scans.

Conclusion

As an expression of CED’s vision, the Strategic Plan sets out the objectives, action priorities and foundations of CED’s regional economic development approach. It draws on best practices in the field and identifies opportunities available to Quebec communities, regions and entrepreneurs, along with the challenges they face. The Plan outlines the scope of areas of intervention in which CED plans to take regional action to contribute to the development of Quebec businesses and regions.

In addition, the Strategic Plan’s objectives are aligned with the Government of Canada’s areas for action in innovation.

CED's 4 objectives

The economic environment will be difficult for the regions, communities, organizations and businesses in the coming years. That is why CED will maintain its dialogue and collaboration with all of Quebec’s regional economic development stakeholders. And that is also why, during this period, CED will be updating its analyses and funding parameters so that it can address and adjust to the needs of its clients and collaborators in a timely manner.

Endnotes

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