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8/6/2019 Competitivness Council Moving Alberta Forward
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Alberta Competitiveness Council
MOVING ALBERTA FORWARD MAY2011
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CONTENTS
MESSAGE FROM THE CO-CHAIRS ...................................................................................... i
EXECUTIVE SUMMARY .........................................................................................................ii
BACKGROUND ................................................................................................................... 12
Enhancing Albertas Competitiveness ........................................................................... 12
Why Competitiveness Matters ....................................................................................... 12
The Competitiveness Pyramid ....................................................................................... 14
The Alberta Competitiveness Council ............................................................................ 15
The Task Team Process ................................................................................................. 16
OVERALL FACTORS OF COMPETITIVENESS .................................................................... 18
AGRICULTURE GRAINS AND OIL SEEDS ....................................................................... 26
FINANCIAL SERVICES ........................................................................................................ 32
MANUFACTURING .............................................................................................................. 38
PETROCHEMICALS / CHEMICALS .................................................................................... 44
MOVING FORWARD TOGETHER ....................................................................................... 49
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Alberta Competitiveness Council Moving Alberta Forward |
MESSAGE FROM THE CO-CHAIRS
A competitive Alberta promotes and enables uture growth and prosperity in the province or current and
uture generations. Improving Albertas competitiveness is a shared responsibility between government
and private business and industry.
In 2010, the Alberta government created the Alberta Competitiveness Council to look at ways to improveAlbertas ability to compete in a global economy. A more competitive economy benets all Albertans by
creating more sustainable and stable economic growth that improves living standards and quality o lie.
The Alberta Competitiveness Council consists o government and industry leaders. Together, we identied
actions needed to increase Albertas competitiveness in general, as well as in our specic sectors:
Agriculture Grains and Oil Seeds;
Manuacturing;
Financial Services; and
Petrochemicals/Chemicals.
The Councils work included developing a ramework or measuring competitiveness to compare Albertasperormance with that o other jurisdictions. This benchmarking study ound that Alberta has a sound
oundation or competitiveness specically, living standards, economic well-being, and taxes and scal
policy. In some areas, however, Alberta has room or improvement, primarily in relation to investments in
research and development, productivity growth and innovation.
Focusing on the ndings rom the benchmarking study and based on consultations with industry, the Council
determined the priority actions to improve Albertas competitiveness. The recommendations are practical
and through collaborative partnerships, they will be implemented with meaningul results.
The work o the Council has never been about implementing a single major initiative nor has the Councils
work been about major spending commitments. It is about moving in the right direction and taking concrete
steps to improve competitiveness and doing so without delay. Most importantly, it is about collectively
responding to challenges and keeping our province on track or a prosperous uture.
We would like to thank the many individuals who shared their knowledge and provided their support as we
prepared this action plan. We commend the collaborative approach used to arrive at this plan. By working
together as equal partners, recognizing that actions must occur in both the public and private spheres,
we will make a dierence.
Honourable
Ed Stelmach
Premier
Bob Brawn
Chair, Alberta Economic
Development Authority
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Executive Summary
Albertas competitiveness matters.
Competitiveness is essential or maintaining Albertas
high quality o lie. A competitive economy attracts
industries and investment to the province, which create
jobs and opportunities or Albertans. A competitiveAlberta also leads to healthy and strong communities.
Businesses that call Alberta home make important
contributions to their communities, and they help
nance public services like education, health,
inrastructure, and environmental protection.
Our provinces competitive position, anchored by our
abundant natural resources, has uelled our growth
and prosperity over the past decade.
However, our continued prosperity is not assured.
Alberta aces a growing number o competitors, and
shiting economic orces stand to impact our uturesuccess. We cannot rest on our past success and
passively expect opportunities to keep coming
to our province.
Simply put, there are other places in the world that
are competing or the same investment, jobs and
opportunities.
Alberta will not be complacent.
We must all work to enhance our provinces
competitiveness government and industry,
academics and investors, and employers
and employees.
In that spirit, and as part o theAra Cii
Ac, the Government o Alberta established the Alberta
Competitiveness Council.
The purpose o the Alberta Competitiveness Council
is to analyze Albertas competitive position relativeto national and international competitor jurisdictions,
and to identiy actions that will sustain and improve
Albertas competitive position.
Consisting o Members o the Legislative Assembly
and business leaders, the Council represents a strong
collaboration between government and industry. This
refects the act that both government and industry
have complementary roles to play in achieving the
shared objective o sustained prosperity.
Benchmarking AlbertasCompetitiveness
In December, 2010, the Council released its Rr
Cii: Ara 2010, which benchmarked
Albertas perormance relative to 14 other national
and international jurisdictions.1
The report measured Albertas position on 60 indicators
across the entire provincial economy, using the
ramework o the Competitiveness Pyramid.
In the Competitiveness Pyramid, the bottom layer
is the bedrock: a series o human and naturalcharacteristics within every jurisdiction. Generally
these change only incrementally over time, i at all.
The bedrock comprises characteristics such as the
location, climate, natural resources, political and legal
systems, and social or cultural aspects o society.
The oundation layer is composed o the key structural
areas upon which a competitive environment is built.
These are actors that government is primarily responsible
or shaping. They include taxes and scal policy,
regulation, transportation and inrastructure, human
capital and education, and access to capital markets.
Competitiveness is the condition
created when government, industry
and Albertans work together to pursue
sustained prosperity.
Alberta Competitiveness Council
Report on Competitiveness: Alberta 2010
1 The report is available at http://www.fnance.alberta.ca/
competitiveness.
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As depicted in the Pyramid, these actors enable
innovation, which is continually required or any
competitive environment. Innovation is developing new
and better ways o doing things like investing in new
machinery and equipment, or adopting more eective
processes. While government can create conditions
that enable innovation, industry has the primary role
in pursuing and deploying innovation.
Innovation promotes productivity. Productivity gains
are essential to sustained prosperity a balance
o social, economic and environmental outcomes
the result that matters or Albertans.
Alberta ranks well in terms o sustained prosperity.
The provinces Gross Domestic Product per capita
an internationally accepted measure o a jurisdictions
overall standard o living is the highest among all
comparator jurisdictions. Our province also scores well
on the Index o Economic Well-being2, which considers
environmental and social measures o well-being such
as equality o income distribution and risks o poverty
and illness.
In addition, Alberta ranks highly on several oundation
actors, such as competitive taxes and inrastructure.
However, there are a number o areas where Alberta
has opportunities or improvement.
To sustain our provinces economic growth, Alberta
must improve its productivity growth. This will require
greater innovation rom industry.
To support industrys ability to innovate, our province must
have a strong oundation or competitiveness. Industry
and government must work together to shape the actors
that will provide a competitive business environment.
The Result for AlbertaSustainable growth in living standards
The Enabler
New and improved products, services
and processes for a global marketplace
Industry in partnership with government
The Foundation
Factors that shape the
business environment
Government in partnership with industry
The Outcome
Better use of resources
The BedrockHuman characteristics: demography, society (political and legal system, culture, social infrastructure)
Natural characteristics: natural resources, location (distance to markets, land base, climate)
2 From the Centre or the Study o Living Standards.
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Overall Factorso Competitiveness
Based on the results o the benchmarking report,
and through conversations with industry leaders and
representatives, the Alberta Competitiveness Council
has identied a number o priority areas that require
urgent attention by government and industry throughoutthe entire economy:
Labour market development
Albertas single greatest challenge to competitiveness
is labour supply. The recent global downturn relieved
some pressure in the provinces labour market, but a new
period o labour shortages is ast upon us. Companies are
already reporting diculty sourcing the workers they need.
This time around, the labour shortage will be structural and
sustained, driven by demographic orces such as an aging
population. Alberta will not be alone. Other developedeconomies are acing the same challenges and will be
competing aggressively or the same workers. Alberta will
ace an ongoing battle or talent, both skilled and unskilled.
Industry will need to adapt their business models,
and deal with labour shortages as the new normal.
Albertas experiences with labour shortages during the
last economic boom have taught us lessons. Our province
must do all it can to develop, attract, and retain workers
here at home, rom across Canada and rom around
the world. There is no single solution to this challenge.
It will require a variety o strategies and continued
collaboration between industry and government in areas
such as engaging populations under-represented in the
workorce (such as Aboriginals, mature workers, and
people with disabilities), workorce training, immigration
policy, and education.
ACTIONS: InCReAse pARtICIpAtIon And
employment of gRoups undeR-RepResented
In the AlbeRtA eConomy.
mAke It eAsIeR to employ tAlent fRom
otheR pARts of CAnAdA And AbRoAd.
Productivity and innovation
Alberta has a productivity problem. Our provinces
productivity growth is weak compared to that o other
jurisdictions.
Productivity growth is critical or Albertas competitiveness,
given the tough labour market challenges the province
will ace. With labour supply unable to meet uture
demand, we will need to produce greater value rom
each hour o work. We must improve productivity
throughout the entire economy, to keep pace with
and exceed that o other jurisdictions.
To do this, Alberta needs to be innovative we must pursue
new and better ways o doing business. The Government
o Alberta has created an environment that encourages
innovation through its tax and scal policies, and through
investments in education and research. Industry must make
use o that environment and examine ways o enhancing
their innovation and productivity.
Innovation can come in many orms, but it requires
nothing short o a culture change. Truly innovative and
productive companies will be those that have strong
leadership and management, oster creativity and risk-
taking, have a qualied workorce, and demonstrate
entrepreneurial spirit.
ACTION: leveRAge pRoduCtIvIty
And InnovAtIon netwoRks.
Transportation, inrastructure,and access to markets
Alberta companies depend on access to high-quality
and reliable transportation systems to enable the fow o
people, goods and services. Maintaining and enhancing
Albertas transportation and inrastructure will be critical
or supporting Albertas long-term competitiveness.
Industry and government must work together to enhance
the eciency and eectiveness o transportation modes
commonly used by Alberta businesses trucking,
rail, and air. In addition to much-needed regulatory
improvements, our transportation systems must benet
rom strategic, long-term planning.
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Enhancing transportation is also essential or expanding
Albertas access to international markets. Currently,
Alberta is highly dependent on U.S. markets, which
poses economic risk to the province. Alberta must
expand the number o sizeable customers or its goods
and services. With some o the worlds largest and most
diverse markets, Asia presents a signicant growth
opportunity or Alberta businesses.
As Alberta works with industry to expand its linkages
with Asian markets, the ports o Vancouver and
Prince Rupert will have increased importance. Alberta
must continue to work with British Columbia and
Saskatchewan through the New West Partnership3
to enhance the ability o Western Canadian rms to get
their products to Asian markets using the Asia-Pacic
Gateway inrastructure.
ACTION: move hIgheR-densIty modules
to AlbeRtA oIl sAnds pRojeCts.
Regulatory competitiveness
Regulation is essential to a well-unctioning economy,
assuring environmental sustainability, and creating
a sae and just society. But outdated, duplicative,
and uncoordinated rules can also impose unnecessary
compliance costs. For business and industry, this can
lower eciency and productivity, resulting in competitive
disadvantages.
Alberta must have eective regulatory systems that
achieve public interest goals in an ecient and aordablemanner. To this end, the Government o Alberta has
a long-standing commitment to a government-wide
regulatory reorm program to improve the eciency
and eectiveness o Albertas regulatory systems.
The program advances a quality-based approach or
improving regulation, which ocuses on the impacts
on stakeholders, including burden reduction.
The participation o stakeholders and businesses in the
regulatory process is an important part o building an
eective system. Businesses need to be able to ully
understand the regulatory environment in which they
operate. Their eedback can help identiy specic
areas where regulatory complexity is hampering
competitiveness and help work towards solutions
that continue to protect the public interest. Increased
coordination among regulators and other governments
(municipal, provincial, ederal) is also required to enhance
opportunities or growth, investment and trade.
ACTION: estAblIsh meAsuRes to RegulARlyAssess AlbeRtAs RegulAtoRy peRfoRmAnCe.
Enhancing SectorCompetitiveness
The benchmarking report marked the beginning o
an ongoing, annual process to enhance Albertas
competitiveness and generate sustained prosperity.
This year, the Alberta Competitiveness Council was
mandated to examine actors impacting the provinces
overall competitiveness and our sectors o Albertas
economy: Agriculture Grains and Oil Seeds, Financial
Services, Manuacturing, and Petrochemicals / Chemicals.
The Council established a task team or each o these
sectors, as well as a task team dedicated to examining
the overall actors o competitiveness.
Building rom the analysis o the benchmarking report,
each task team consulted with industry representatives and
stakeholders in these our sectors. The task teams also
consulted with other government advisory bodies such
as Alberta Economic Development Authority and Alberta
Innovates. Inormed by this input, each task team identied
issues impacting Albertas competitiveness in each sector,
and developed a series o key actions aimed at addressing
those issues and enhancing the sectors competitiveness.
The key actions are designed to be timely and practical
solutions that can be readily implemented. They are
intended to address specic competitiveness pressures
acing each sector, and to realize demonstrable
improvements in the near-to-medium-term (i.e., within
ve years). They are deliberately limited in number,
ensuring they can be implemented with the resources
available, and will complement ongoing eortsby industry and government to better position our
province or sustained prosperity.
3 Inormation about the New West Partnership is available at
http://www.international.alberta.ca/645.cm
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Agriculture Grains and Oil Seeds
There are signicant economic opportunities ahead or
Albertas grains and oil seeds sector. Estimates suggest
the worlds population will increase to about 9.3 billion
people by 2050, up rom about 6.9 billion in 2010, led by
growth in developing countries.4 Over the next ew decades
increasing prosperity among consumers will lead to rising
demand or imports o ood and agricultural commodities.
These developments oer opportunities or Albertas
grains and oil seeds sector. However, the sector aces
some hurdles. Certain areas o agriculture policy remain
challenging, including the lack o marketing choice or
wheat and barley. As in other agriculture sectors, ewer
members o newer generations choose to enter grains
and oil seeds arming. The cereal grains sector is also
alling behind in productivity improvement compared
to crops such as corn, soybeans and canola.
To capitalize on uture opportunities, Albertas grains and oil
seeds sector must continually enhance its competitivenessthrough research and innovation, market access and
market development, rural renewal, and improved policy,
regulatory and institutional systems.
ACTIONS: ContInue to suppoRt mARketIng
ChoICe foR wheAt And bARley.
Adopt And AdvAnCe polICIes thAt enAble A
moRe CompetItIve And InnovAtIve IndustRy.
AttRACt fARmeRs fRom oveRseAs.
develop And suppoRt pIlot InCubAtoR fARms.
AddRess the fundIng And goveRnAnCe model
foR gRAIns And oIl seeds ReseARCh And
InnovAtIon foR AlbeRtA And westeRn CAnAdA.
Financial Services
The nancial services industry is one o Albertas key
growth sectors, contributing over $8 billion to the provinces
economy.5 Strong energy prices and signicant
investments in oil sands development have resulted in
a remarkable expansion o the nancial services industry
during the past decade. Albertas nancial services industry
has strong growth prospects, and numerous strengthsit can leverage and build upon. Now is an opportune
time or Alberta to capitalize on these strengths.
The world-class niche strengths o Albertas nancial
services industry are not as internationally well-known
as they could be. Alberta needs to be top o mind
or nancial services rms, skilled workers in the sector,
or those managing large pools o capital. Alberta also
needs to enhance the development, attraction and retain
retention o skilled nancial services talent.
To ensure the sectors continued growth and
competitiveness, government and members othe nancial services industry will need to work
in partnership to address these issues.
ACTIONS: estAblIsh An IndustRy-goveRnment
fInAnCIAl seRvICes seCtoR gRoup.
develop And Implement A bRAndIng And
mARketIng stRAtegy foR AlbeRtAs fInAnCIAl
seRvICes IndustRy.
develop, AttRACt, And RetAIn fInAnCIAl
seRvICes tAlent.
Manuacturing
Alberta oers many advantages to manuacturing
companies. However, geographic and demographic
realities present challenges to manuacturers
in the province.
5 Statistics Canada, November 2010 estimates or 2009,
in chained (2002) dollars.4 United Nations Population Division.
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Alberta manuacturers in some cases ace higher costs
and longer lead times than manuacturers in competing
jurisdictions due to Albertas northern and landlocked
location. This industry also aces diculty recruiting
and retaining workers a challenge compounded by
the dominance o Albertas oil and gas industry, which
competes or many o the same workers. Manuacturers
also ace pressures rom ever-evolving market dynamics,
including: the emergence o new global supply chains,
increasing competition rom lower-cost international
markets, and the rising value in the Canadian dollar.
Enhancing the competitiveness o Albertas manuacturing
industry requires urgent attention to two major drivers:
people and productivity. These drivers are highly
interrelated; without qualied people, manuacturers
cannot keep pace with developments that will make
them more productive in the uture. Action on both
ronts is required to enhance the manuacturing
sectors competitiveness.
ACTIONS: stRengthen pRoduCtIvIty AlbeRtA
thRough An InCReAsed Role And owneRshIp
by IndustRy.
undeRtAke A demonstRAtIon pRojeCt to
fACIlItAte moRe employeR-suppoRted tRAInIng.
Petrochemicals/Chemicals
Alberta is Canadas leading producer o petrochemicals,
and the petrochemicals/chemicals industry represents
signicant value-adding activity in Albertas economy.Today, Albertas industry includes our ethane-cracking
plants, including two o the worlds largest. Albertas
industry also has key advantages over its main
competitor, the U.S. Gul Coast, including newer and
more ecient acilities and historically lower prices
or ethane eedstock.
Despite these advantages, the industrys long-term
competitiveness and viability is now at risk due to
dwindling eedstock supplies, due to changes in the
natural gas marketplace and the maturity o Albertas
conventional gas elds. Although current and uture
natural gas production outside the province oer potential
sources o ethane, regulatory uncertainty threatens
Albertas ability to capitalize on these opportunities.
To remain competitive and viable, industry and government
must work together to obtain more ethane at competitive
prices by enhancing regulatory certainty, improving policies,
and leveraging Albertas inrastructure advantages.
ACTIONS: enhAnCe the InCRementAl ethAne
extRACtIon pRogRAm.
leveRAge And enhAnCe the AlbeRtA nAtuRAl
gAs hub.
ChAmpIon RegulAtoRy CeRtAInty to ImpRovethe extRACtIon And pRoCessIng of nAtuRAl
gAs lIquIds In the pRovInCe.
Going orward, the Alberta Competitiveness Council
will monitor Albertas progress in implementing the key
actions at the sector level and across the economy.
The Council will also consider research and other
inormation to identiy a new series o economic sectors
or task team examination.
Working together industry, government and all Albertans
we will build on our current competitiveness, and positionAlberta or even greater success in the new global economy.
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Alberta Competitiveness CouncilActions to Enhance Competitiveness Summary Table
ACTION IMPLEMENTATION STAGE
oveRAll fACtoRs of CompetItIveness
1. Increase participation and employment o groups
under-represented in the Alberta economy. Update and implement the provinces bii a
ecai trr wrrc strategy.
Target initiatives to increase the participation o these Albertans.
Initiated
Government departments, training institutionsand employers are working together to update
and develop new strategies.
2. Make it easier to employ talent rom other parts
o Canada and abroad.
Accelerate advocacy eorts with the ederal government,
with the goal o improving immigration policies and programs.
Implement Alberta Economic Development Authoritys
baaci Ara wrrc report.
Initiated
Alberta government and businesses are
providing input on ederal reviews on
immigration.
Alberta government is taking action on
oreign qualication recognition, including
perormance measure targets or 2015.
3. Leverage productivity and innovation networks.
Maximize the use o resources and networks provided by
organizations such as Productivity Alberta through increased
awareness and stronger promotion.
Identiy new economic opportunities and commercialize
innovative technologies through the work o the Alberta
Innovates system, industry and other government
organizations.
Initiated
Expanded Productivity Alberta programs
and services in the past year.
Alberta Innovates organizational structure
implemented in 2010.
4. Move higher-density modules to Alberta oil sands projects.
Increase weight limits to provide the sae transportation
o higher-density modules along Albertas main high-loadcorridor rom the Edmonton region to the Municipality
o Wood Bualo.
Initiated
Feasibility assessment o a heavy load corridor
between industry and Alberta Governmentunder way.
5. Establish measures to regularly assess Albertas regulatory
perormance.
Dene measures to assess and validate regulations
as eective and ecient.
Initiated
Assessment o potential measures under way
with Albertas Regulatory Review Secretariat.
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ACTION IMPLEMENTATION STAGE
AgRICultuRe gRAIns And oIl seeds
6. Continue to support marketing choice or wheat and barley.
Utilize every avenue and opportunity to consult and
coordinate with other western provinces and the ederal
government to advance the marketing choice le so Alberta
armers are able to sell their grains to whomever they choose.
Initiated
Alberta government motion made in support
o ederal action on marketing choice.
Alberta Grains Council serving as an advocacy
body or producers.
7. Adopt and advance policies that enable a more competitive
and innovative industry.
During ederal/provincial/territorial negotiations, champion a
position or Growing Forward 2 that calls or policies, programs
and services important or long-term competitiveness.
Initiated
Federal/provincial/ territorial discussions
ongoing. New agreement in place in 2013.
8. Attract armers rom overseas.
Develop and implement a strategic plan or attracting
immigrant armers to Alberta.
Initiated
Cross-ministerial eort in development.
Inormation or use by international arm media
being developed.
9. Develop and support pilot incubator arms.
Leverage opportunities or new crop development.
Initiated
Business case or incubator arms, including
potential locations, in development by Alberta
Agriculture and Rural Development.
10.Address the unding and governance model or grains
and oil seeds research and innovation or Alberta
and western Canada.
Explore ways to address gaps in Research and Development
unding or cereal grains.
Work within the New West Partnership to establish shared
approaches with B.C. and Saskatchewan.
Planning
Preliminary review and inormation gathering
underway.
fInAnCIAl seRvICes11.Establish an industry-government fnancial services
sector group.
This group would support the growth o the nancial
services industry by monitoring issues and inorming
regulatory/policy decisions.
Initiated
Discussions on governance and unding
between industry and government under way.
12.Develop and implement a branding and marketing strategy
or Albertas fnancial services industry.
Take advantage o global recognition o the stability and
integrity o the Canadian nancial system and Albertas
competitive tax policies.
Planning
To be completed by industry-government
nancial services sector working group.
13.Develop, attract, and retain fnancial services talent.
Fostering the expansion o the Alberta Finance Institute.
Increase the talent pool available to the nancial services
industry in the province.
Initiated
Discussions on the expansion o the Alberta
Finance Institute underway with stakeholders.
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ACTION IMPLEMENTATION STAGE
mAnufACtuRIng
14.StrengthenProductivity Alberta through an increased role
and ownership by industry.
Move prcii Ara rom a government entity to a not-
or-prot business model to enable a greater role or industry
and better use o/access to prcii Ara resourcesand services.
Initiated
Governance and nancial structures under
development. First stage o transer targeted
or completion by June, 2011.
15.Undertake a demonstration project on employer-supported
training.
Implement a program that assesses employer / employee
training needs and targeted support through employer-
supported training programs.
Initiated
Funding arrangements established. Pilot project
parameters in development.
petRoChemICAls / ChemICAls
16.Enhance the Incremental Ethane Extraction Program.
Alleviate the growing shortage o ethane supplies by making
program changes to increase adoption and uptake by industry.
Encourage more ethane extraction rom o-gases that result
rom bitumen rening or upgrading
Complete
Program changes announced March, 2011.
Industry commitments made March, 2011.
17.Leverage and enhance the Alberta Natural Gas Hub.
Develop the concept and relationships needed to capitalize
on the extensive inrastructure and state-o-the-art
complexes in Alberta with western Canadian and other
jurisdictions.
Planning
Consultation with sector stakeholders set
to begin.
18.Champion regulatory certainty to improve the extraction
and processing o natural gas liquids in the province.
Develop policy statement arming the governments
commitment to acilitating value-added development in theprovince, to guide regulation and developments in upcoming
National Energy Board (NEB) hearings.
Initiated
Policy development and required approvals
to pursue intervener status or NEB hearings
in process.
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Alberta Competitiveness Council Moving Alberta Forward | 11
Background
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We must ensure Alberta provides a climate
where entrepreneurship, innovation,productivity, and investment thrive.
Background
Enhancing AlbertasCompetitiveness
Albertas competitive tax system, investments in
essential programs, services and inrastructure,
and abundant natural resources all contribute to our
substantial economic growth and current prosperity.
However, this does not mean that Albertans uture
prosperity is assured. A growing, rapidly changing
and increasingly interconnected world is giving rise
to economic orces that will impact our province.
Alberta aces increased competition rom within
Canada, North America, and rom around the world.
Each day people and companies make decisions about
their uture where to work, where to live and raise
their amilies, where to invest or expand, and whereto seek new opportunities. Whether they choose Alberta
is directly infuenced by how competitive our province
is and continues to be.
To ensure Albertans can enjoy long-term prosperity,
the province must work to maintain and enhance its
competitiveness. We must ensure Alberta provides a
climate where entrepreneurship, innovation, productivity,
and investment thrive.
Competitiveness is not just the concern o economists
or investors. It is in everyones interest or Alberta to be
as competitive as possible government and industry,
academic institutions and leaders, and individual
Albertans who work every day to advance the prosperity
o the province.
By ocusing on competitiveness we will maintain
and improve our quality o lie and uphold the values
important to Albertans.
There are several initiatives with the goal o ensuring
Albertas prosperity or uture generations. These include:
prir Cci r ecic sra
Established in 2009 and comprised o globally
recognized business leaders and experts, the
Council has provided a long-term vision and starteda conversation on how Albertans can shape a uture
that builds on the provinces strengths and values,
while taking it in exciting new directions.
erizi I In early 2010, as a response
to changes in the energy marketplace, Alberta Energy
outlined and led a series o initiatives to position
Alberta as one o the most competitive jurisdictions in
North America or upstream oil- and gas-development.
Ara Cii Iiiai Introduced in the
summer o 2010, theAra Cii Ac
brings together government, industry, and Albertansto develop a shared strategy to measure and improve
the provinces overall competitiveness.
Aia Air Cci Established by theAia
Air Cci Ac, the Council will examine ways
o expanding business, education, and cultural
linkages between Alberta and Asia, to develop
new markets and opportunities or our province.
Why Competitiveness Matters
Sustained prosperity is created when government,
industry, and Albertans work together to pursuea common objective a competitive economy.
Sustained prosperity is about improving the standard o
living and quality o lie or all Albertans. While good jobs
and income are important elements or a high quality o
lie, sustained prosperity is not measured only in terms
o economics. It is also about the things we value as a
society including positive health outcomes, a rst-rate
education system, and a clean and healthy environment.
Prosperity is typically represented in terms o the
Gross Domestic Product. While this is one important
quantitative measure o prosperity, to be trulyprosperous Alberta needs to achieve a balance
o social, economic, and environmental outcomes.
Our provinces ability to improve and invest in those
areas depends on maintaining and enhancing our
long-term competitiveness.
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Alberta Competitiveness Council Moving Alberta Forward | 13
We can expand the Gross Domestic Product by workingharder or working smarter.
Working harder means increasing the total labour eort
in the economy. This is accomplished by expanding
the workorce or by working longer hours. Realistically,
neither approach provides the right answer, particularly
in light o Albertas current labour orce participation and
changing demographics. Alberta has one o the highest
levels o labour eorts in Canada there is limited room
to increase participation in the Alberta workorce.
An aging population and continuing pressures in the
labour market will mean that Albertas standard o living
cannot be sustained solely by increasing total labour eort.
The alternative is or Albertans to work smarter by
generating more economic activity per hour worked.
This means increasing Albertas productivity. By increasing
productivity we can maintain and enhance Albertas
global competitiveness, which can urther improve
our standard o living and sustain our uture prosperity.
Through innovation, there are virtually no limits on how
productive we can be.
Innovation is the key to developing new and improvedproducts, services, and processes or a global marketplace.
No single actor causes innovation to occur, but a variety
o actors help to oster innovation and attract investment
to the province. Our capacity to innovate depends on
having the right combination o skilled people, nance,
inrastructure, strong management and leadership,
and many other actors.
The role o government is to ensure that policies and
programs refect the values o Albertans and establish
a competitive business climate. Industry must lead
by creating jobs, seizing economic opportunities, and
investing in innovation and productivity. Creating the
right mix o policies and actions requires a partnership
between government and industry to reach our shared
objective o sustained prosperity.
The interrelated nature o these concepts is depicted
in Albertas Competitiveness Pyramid. The pyramid
provides a ramework or examining Albertas
competitive position and developing initiatives
to enhance Albertas long-term competitiveness.
QC
MB
ON
BC
AB
SK
FIN
WA
MN
OR
CO
TX
QLD
GDP per capita, US$ at PPP (LHS) Real GDP per capita annualgrowth rate, 2003-2008 (RHS)
GDP per capita (2008) and real GDP per capita growth (2003-2008)
RealGDPpercapitagrowthrate
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
GDPpercapita,
US$atPPP
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
NOR ID
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14 | Alberta Competitiveness Council Moving Alberta Forward
The Competitiveness Pyramid
In the pyramid, the bottom layer is the bedrock: a series
o human and natural characteristics within every
jurisdiction. Generally, these change only incrementally
over time, i at all. The bedrock comprises characteristics
such as the location, climate, natural resources, political
and legal systems, and social and cultural aspects
o society.
The oundation layer is composed o the key structural
areas upon which a competitive environment is built.
These are actors or which government is primarily
responsible, including: taxes and scal policy, regulation,
transportation and inrastructure, human capital and
education, and access to capital markets.
As depicted in the pyramid, these actors enable
innovation, which is required continually or any
competitive environment. Innovation is developing
new and better ways o doing things such as
investing in new machinery and equipment, adopting
more eective processes, training skilled labour,
or undertaking research and development activities.
While government can create conditions that enable
innovation, industry has the primary role in pursuingand deploying innovation.
Innovation promotes productivity. Productivity gains are
essential to sustained prosperity a balance o social,
economic, and environmental outcomes the result that
matters or Albertans.
The Result for Alberta
Sustainable growth in living standards
The EnablerNew and improved products, services
and processes for a global marketplace
Industry in partnership with government
The FoundationFactors that shape the
business environment
Government in partnership with industry
The Outcome
Better use of resources
The BedrockHuman characteristics: demography, society (political and legal system, culture, social infrastructure)
Natural characteristics: natural resources, location (distance to markets, land base, climate)
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Alberta Competitiveness Council Moving Alberta Forward | 15
The Alberta Competitiveness Council
The Alberta Competitiveness Council was established
in May, 2010, through theAra Cii Ac.
The Alberta Competitiveness Council was charged with
implementing the directions outlined in the Act.
The purpose o the Alberta Competitiveness Council
is to analyze Albertas competitive position relative
to national and international competitor jurisdictions,
and to identiy actions that will sustain and improve
Albertas competitive position.
The Council represents a strong collaboration between
government and industry.
For this rst year, the Council included task teams
mandated to examine our sectors o Albertas economy
and the overall actors o Albertas competitiveness.
Each task team is co-chaired by a Member o the
Legislative Assembly and a senior representative rom
industry, working together to analyze issues and develop
actions or enhancing Albertas competitiveness.
This approach recognizes that industry, government and
all Albertans must engage in ongoing dialogue and work
together to create the right mix o policies and actions
to generate prosperity.
While the Government o Alberta can take certain actions
to improve the oundation (i.e., the provinces business
climate), Albertas long-term prosperity also dependson industry taking corresponding actions to maximize
the opportunities aorded by that climate and improve
competitiveness.
On an ongoing basis, government and industry must
build consensus on what is required to generate
sustained prosperity and then get on with the job
o supporting innovation, improving productivity,
and empowering our workorce.
In December, 2010, the Council released its Rr
Cii: Ara 2010, which examined Albertas
competitive position and benchmarked its perormance
relative to 14 other national and international jurisdictions.
Using the ramework o the Competitiveness Pyramid, thereport measured Albertas position on 60 indicators across
the entire provincial economy.
Comparator Jurisdictions
Canada: British Columbia,Saskatchewan, Manitoba, Ontario,
and Quebec.
United States: Colorado, Idaho,Minnesota, Oregon, Texas, and
Washington.
International: Finland, Norway,and the State of Queensland, Australia.
Government Co-Chair Industry Co-Chair
Council Co-Chair Premier StelmachMinister Snelgrove (alternate)
Bob BrawnAlberta Economic Development Authority
Agriculture (Grains and Oil Seeds) Mr. George GroeneveldMLA, Highwood
Dr. Christoph WederSpiritView Ranch
Financial Services Ms. Janis Tarchuk
MLA, Ban-Cochrane
Mr. Greg Turnbull
Partner, McCarthy Ttrault
Manuacturing Mr. George RogersMLA, Leduc-Beaumont-Devon
Mr. Larry Kaumeyer
President, Almita Manuacturing Ltd.
Petrochemicals / Chemicals Mr. Ray PrinsMLA, Lacombe-Ponoka
Mr. Val MiroshPresident, Mircan Resources Ltd.
Overall Factors o Competit iveness Mr. Cal Dallas
MLA, Red Deer-SouthMr. Les LaRocquePresident, Botting & Associates Alberta Ltd.
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The report provides a baseline set o measures that will
enable evaluation o the provinces competitive position now
and in uture years, while also considering the our economic
sectors that were identied as priority areas o work or
the rst year o the Alberta Competitiveness Council:
Agriculture Grains and Oil Seeds;
Financial Services;
Manuacturing; and
Petrochemicals/Chemicals.
These sectors were selected based on their roles in the
provinces economy and the opportunities to improve
Albertas competitive position in each o them. They were
also selected to complement Alberta government-led
initiatives ocusing on other sectors (e.g., oil sands,
oil and natural gas) to ensure a broad scope o Albertas
economy benets rom examination. Additional sectors
are expected to be reviewed in uture years.
The Task Team Process
Building rom the analysis o the benchmarking report,
each Council task team examined one o the our economic
sectors and the overall actors o competitiveness.
As part o this examination, each task team consulted
with industry representatives and stakeholders in the
sector, and with other government advisory bodies
such as Alberta Economic Development Authority
and Alberta Innovates.
Inormed by this input and analysis, each task teamidentied issues and actors impacting Albertas competitive
position in the sector. They then developed a series
o key actions aimed at addressing these issues and
enhancing the sectors competitiveness.
The key actions developed by the task teams are
designed to be timely and practical solutions that can
be readily implemented. They are intended to address
specic competitiveness pressures acing each sector,
and to realize demonstrable improvements in the
near-to-medium-term (i.e., within ve years). They are
deliberately limited in number, ensuring they can be
implemented with the resources available, and willcomplement broader initiatives already underway
by government and industry.
The key actions refect the importance o a shared
responsibility by both government and industry in
enhancing the provinces competitiveness or the
betterment o all Albertans.
While industry must act on its own accord, there
are powerul incentives to take action on increasing
innovation, improving productivity, and enhancing
competitiveness. Companies in Alberta will continueto ace growing competition rom other domestic and
international players. Those taking action today will
better position themselves to conront the realities
o tomorrows economy and marketplace.
About This Report
This report summarizes the ndings o the Councils
task teams:
Overall Factors o Competitiveness;
Agriculture Grains and Oil Seeds; Financial Services;
Manuacturing; and
Petrochemicals/Chemicals.
Each chapter describes Albertas competitive position
in a sector, and identies actions or government and
industry that aim to address the competitiveness
pressures o that sector. For each area, sector-level
benchmarks are also outlined to enable ongoing
evaluation o Albertas competitiveness in each sector.
These will complement the indicators in the Councils
benchmarking report, oering a more complete picture
o Albertas competitiveness at the sector level.
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Alberta Competitiveness Council Moving Alberta Forward | 17
Overall Factors o Competitiveness
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Overall Factors o Competitiveness
The results o the December, 2010, benchmarking
report indicate that Alberta is perorming well
against comparator jurisdictions both nationally
and internationally. Alberta rates either above average
or average in the majority o the measures.
Alberta ranks well in terms o sustained prosperity.
The provinces Gross Domestic Product per capita
an internationally accepted measure o a jurisdictions
overall standard o living is the highest among all
comparator jurisdictions. Among Canadian comparator
jurisdictions, Albertans benet rom the highest personal
income ater tax.
Our province also scores well on the Index o Economic
Well-being, developed by the Centre or the Study o
Living Standards. This index considers measures o well-
being beyond economics, including environmental and
social measures such as equality o income distribution,and risks o poverty and illness.
Albertas strongest rankings are in the areas o taxes and
scal policy. Residents and businesses in the province
benet rom the lowest overall tax burden o any
jurisdiction in Canada. This is one o several important
oundational actors needed to attract investment and
support economic growth.
Moreover, Albertas net nancial assets are strong,
thanks to our signicant natural resources and provincial
policies relating to debt nancing. The provinces public
nances are not burdened with high debt servicing costs.
While demonstrating Albertas competitive strengths,
the benchmarking report also revealed a number o areas
where Alberta has opportunities or improvement.
Albertas GDP growth has been primarily driven by
increased labour eort brought about by high levels
o labour eort rom individual Albertans and high
population growth rom interprovincial and international
migration. However, Alberta will not be able to sustain its
economic growth solely by increasing total labour eort.Aging demographics and slower workorce growth place
practical limitations on this approach.
To sustain our provinces economic growth, Alberta
must improve its productivity. This will require greater
innovation rom industry.
To support industrys ability to innovate, our province must
have a strong oundation or competitiveness. Industry
and government must work together to shape the actors
that will provide a competitive business environment.
It is important that Alberta takes a strategic approachto enhancing its competitiveness. Alberta need not be
a leader in every measure o competitiveness, but rather,
ocus its resources and actions or the greatest eect.
Based on the results o the benchmarking report,
and through conversations with industry leaders and
representatives, the Alberta Competitiveness Council has
identied a number o priority areas that require urgent
attention by government and industry. Strategic actions
in these areas will benet all sectors o the economy, and
will eectively enhance Albertas overall competitiveness.
LABOUR MARKET DEVELOPMENT
Having the right workers with the right skills at the
right time is essential or our provinces long-term
competitiveness. Limited access to labour can result
in uncompetitive labour rates and missed economic
opportunities or the province.
Albertas single greatest challenge to competitiveness
is labour supply.
Alberta experienced a period o labour shortages during
the last economic boom. The recent global downturn
relieved some pressure in the provinces labour market,but with a return to economic growth Alberta is already
entering another period o labour shortages. Several
companies are reporting diculty in sourcing labour,
especially companies in the energy sector.
To sustain our provinces economic growth,
Alberta must improve its productivity.
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Alberta Competitiveness Council Moving Alberta Forward | 19
This is going to be a continuing challenge or our province.
Although Alberta has one o the youngest workorces
among comparator jurisdictions, the provinces
population is aging. Thousands o baby boomers will
leave the workorce over the next two decades.
Alberta will not be alone in acing this challenge. Developed
economies around the world ace similar situations,
driven by similar demographic realities, and they will becompeting aggressively or the same skilled labourers.
In the years ahead, Alberta will ace an ongoing battle
or labour.
Industry will need to regard labour shortages not
as a temporary anomaly, but as the new normal.
Companies will need to examine their business models
and determine how they will adapt to an economy
with a persistent labour shortage.
At the same time, to mitigate labour shortages our
province must do all that it can to develop, attract,
and retain the skilled workers our economy requires.
Industry and government will need to work together
to expand our provinces labour market.
At home, we must ensure the provinces education system
equips Albertans with the skills and ideals required to
build a creative and competitive economy o the uture
including skills such as nancial literacy, community
engagement and entrepreneurial spirit. This will require
all levels o our system to work together to develop
programs that train individuals who are well equipped
to meet the needs and expectations o the workplace.
Alberta has taken important steps in transorming the
provinces education system to help ensure all students
are inspired to achieve success and ulllment as engaged
thinkers and ethical citizens with an entrepreneurial spirit.7
The Competitiveness Council is encouraged by this and
stresses that it must continue as a top priority or action.
Albertans must be ully engaged in the workorce. While
employers oten struggle to nd workers, there remainAlbertans who are without employment. Aboriginal
Albertans a population that is young and growing
could make up a signicant portion o Albertas labour
orce. Similarly, mature workers are a growing cohort
with valuable experience. Albertans with disabilities
and youth oten struggle to nd a meaningul place
in the Alberta economy.
Feedback rom the Alberta Employment and
Immigrations2010 miir wrrc fr8
conrmed that successul employment or these
Albertans depend on several actors appropriateeducation and training, connection to the right job
opportunity, and the willingness o employers to consider
them as potential employees. Given the prosperity
o Alberta, and the resulting workorce shortages,
these Albertans must be ully engaged and share
in the provinces economic prosperity.
ACTION: InCReAse pARtICIpAtIon And
employment of gRoups undeR-RepResented
In the AlbeRtA eConomy.
Alberta Employment and Immigration is working withother government departments, training institutions and
employers to implement targeted workorce strategies and
initiatives to increase the participation o these Albertans.
Albertas single greatest challenge
to competitiveness is labour supply.
Companies will need to examine their
business models and determine how they
will adapt to an economy with a persistent
labour shortage.
7 Inspiring Action on Education: https://ideas.education.alberta.ca/
engage/previous-initiatives/inspiring-action.aspx
8 Inormation on the Ministers Workorce Forum: http://www.employment.
alberta.ca/BI/12568.html
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The Alberta Competitiveness Council supports
the eorts o government to update the provinces
bii a ecai trr wrrc strategy,
and the implement the recommendations in Alberta
Economic Development Authoritys baaci Ara
wrrc9,10 report. Other strategies such as the fir
nai, mi a Ii wrrc pai Iiiai
will also eed into this process.
Realistically, these eorts will only take Alberta so ar.
To help meet our labour orce needs, our province
will increasingly need to attract and retain workers
rom outside the province. Industry and government
must build on initiatives such as the Alberta Immigrant
Nominee Program and the Temporary Foreign Worker
program. Since immigration alls outside provincial
authority, it is essential that industry and the Government
o Alberta provide clear inormation and direction
to the ederal government to ensure these programs
meet provincial needs.
One opportunity warranting attention is the ability
to attract workers rom the United States. Faced with
relatively higher unemployment, workers in the United
States are looking or economic opportunities. Many
have the skills required by Albertas economy. Seizing
this opportunity will require the ederal government
to reduce the regulatory burden and to work with U.S.
counterparts to acilitate the movement o workers
across the border.
As we look beyond our borders or workers, Alberta
communities have an important role in welcoming and
integrating newcomers to help smooth the challengesthat many immigrants ace when moving to Alberta.
By ostering robust settlement services and welcoming
communities, Alberta can establish itsel as a avourable
place to re-settle, making the province more attractive
to workers, innovators, investors, and entrepreneurs
rom around the world.
Alberta will continue to ace sti competition rom other
jurisdictions or the same skilled workers. I there are too
many barriers to coming to Alberta, skilled workers will
go elsewhere. Given the critical importance o labour
supply to our competitiveness, our province must do
what it can to make it easier or workers to choose
Alberta over other destinations. Albertas recent
experiences with labour shortages provide lessons
on how industry and government can eectively act
to help mitigate uture shortages.
ACTION: mAke It eAsIeR to employ tAlent fRom
AlbeRtA, otheR pARts of CAnAdA And AbRoAd.
Industry and the Government o Alberta must accelerate
advocacy eorts with the ederal government, with
the goal o ensuring ederal immigration policies and
programs meet provincial needs. In particular, there must
be a ocus on ways to reduce delays in processing time
and broadening access to immigrants who have theskills and abilities our economy needs. Adaptations to
the Temporary Foreign Worker and Alberta Immigrant
Nominee programs can help improve the ability o Alberta
rms to strategically engage the labour resources needed
to grow their businesses. Attention must also be given to
oreign qualication recognition, so that qualied skilled
workers, in a wider range o occupations needed, who
come to the province can participate ully in the economy.
Action on labour mobility agreements to improve
access and movement o workers rom other parts
o Canada also remains important. Cooperation
between industry, ederal and provincial jurisdictions
is critical or standardizing credentials across Canada
and or determining equivalencies to Alberta
occupational standards.
PRODUCTIVITY AND INNOVATION
Alberta has a productivity growth problem.
Productivity is about the better use o all our available
resources including our land, natural resources,
labour, and capital resources. Labour productivity is the
single most important determinant in maintaining andenhancing sustained prosperity.
Productivity is especially critical, given the tough labour
market challenges our province will ace. With labour
supply unable to meet uture demand, we will need
to produce greater value rom each hour o work.
9 The AEDA report can be ound at: http://aeda.alberta.ca
10 The report, Connecting the Dots: Aboriginal Workorce and Economic
Development, can be ound at: http://employment.alberta.ca/BI/3282.html
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Alberta Competitiveness Council Moving Alberta Forward | 21
Alberta has a high productivity level compared
to most other jurisdictions. However, the provinces
productivity growth over the past decade has been
slower compared to the United States and other
international jurisdictions, which negatively impacts
on Albertas global competitiveness.
To remain competitive, Albertas productivity growth must
improve across the entire economy. It must keep pacewith and exceed the productivity o other jurisdictions.
Productivity growth should concern all Albertans
government and industry, academics and investors,
and employers and employees. We need to grow our
productivity i we wish to maintain our standard o living.
Productivity gains can be achieved in many ways,
including: improving the business environment; ostering
innovation; increasing capital intensity (machinery
and equipment, and inormation and communications
technology); enhancing inrastructure; and strengthening
human capital.
A key to improving Albertas productivity is the use
o innovation employing new approaches, products,
technology, and tools to generate more value or the
same amount o eort. There are many ways to innovate.
While people oten think o innovation in terms o major
technological leaps, innovation can come in the orm
o incremental changes that aim or continuous
improvement. For example, the simple idea o stacking
two containers on top o each other on railway cars
served to double productivity o that mode o transport.
The Alberta government has created an environment that
encourages innovation through its tax and scal policies,
and investments in advanced education and research,including initiatives throughAra Ia.
It is up to industry to make use o that environment and
examine ways o enhancing productivity and innovation.
Companies are best suited to understand their business
models and to adopt new ways o thinking, managing,
and operating.
There are many approaches companies can take,
depending on their economic sector and the nature
o their individual businesses. These include investing in
machinery, equipment, and technology, and in investing
in their workers to enhance skill sets.
What is required, however, is nothing short o a culture
change. Truly innovative and productive companies will
be those that have strong leadership and management,
oster creativity and risk-taking, and demonstrate
entrepreneurial spirit.
To compete, Alberta companies will need to reignite
the entrepreneurial spirit or which they have long been
known. Industry must take stock o the reality that they
are no longer competing within Alberta or North America,but competing with the world.
ACTION: leveRAge pRoduCtIvIty
And InnovAtIon netwoRks.
Initiatives that help Alberta businesses access
knowledge and resources are essential in developing
the leadership capabilities, process improvements,
and investments in machinery and equipment that
will enhance innovation and productivity.
This includes the work o prcii Ara11,which oers a variety o resources, including an online
diagnostic tool that owners and managers can use
to assess productivity.
Alberta Advanced Education and Technology has also
made improving innovation perormance a priority,
through itsAci pa: brii tc mar,
and the creation o theAra Ia corporations.
The Competitiveness Council welcomed eorts to develop
Albertas innovation and productivity connections.
Alberta needs to maximize use o the resources
and networks these organizations are providing.
To compete, Alberta companies will need
to reignite the entrepreneurial spirit for
which they have long been known.
11 Inormation about Productivity Alberta can be ound at:
http://www.productivityalberta.ca/
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TRANSPORTATION, INFRASTRUCTURE,AND ACCESS TO MARKETS
Alberta companies depend on access to high-quality and
reliable transportation systems to enable the fow o people,
goods, and services. The age and extensiveness o Albertas
transportation and inrastructure is a competitive advantage.
The Government o Alberta has built on this advantage inrecent years by placing strong emphasis on inrastructure.
Signicant investments have been made to provincial
highways and major corridors to increase eciency,
including the development o ring roads around Calgary and
Edmonton and twinning o Highway 63 to Fort McMurray.
Important public inrastructure investments are also
being made in the schools and hospitals our province
needs. Alberta continues to lead all Canadian provinces
in government inrastructure investment per capita.
Electricity transmission and supply is another
inrastructure issue o great concern to Alberta industries.
To be competitive, Alberta companies require stable,
reliable and cost-competitive electricity supplies. Critical
electrical transmission upgrades are needed i Alberta isto continue to grow and prosper. Albertans have many
strong views on these issues, and they all have a stake
in the outcome. Alberta needs a transmission plan that
includes staging o inrastructure investments, strong
oversight, and best practices in tendering contracts
to minimize uture increases in electricity costs.
An unchangeable reality acing Alberta businesses is the
provinces geographical distance rom major markets.
Consequently, total transportation costs aced by Alberta
companies are generally higher than those aced by
companies in comparator jurisdictions, particularly the
United States.
However, when considered on cost-per-mile basis, it has
been ound that the primary modes o transportation
trucking, rail, and a combination o surace transport
and ocean containerization oer generally competitive
rates. As a proportion o the total value o delivered cost,
transportation costs do not dier widely between Alberta
and other jurisdictions, and are not a signicant source
o competitive disadvantage.
Maintaining and enhancing Albertas transportation
and inrastructure will be critical or supporting Albertas
long-term competitiveness.
Trucking is the key mode by which Alberta manuacturers
obtain access to North American markets. Rail is an
important mode or the movement o bulk goods, while
air service is used mainly or high value or time sensitive
products. Industry and government will need to work
together to enhance the eciency and accessibility
o these major modes o transport.
One key opportunity is to harmonize trucking regulations
across Canadian provinces and along Albertas major
trade corridors in the United States. Dierences in
these regulations orce shippers to conorm to the
most restrictive regulatory regime, undermining the
ability o Alberta shippers to reach key markets. Greater
standardization o weights and congurations that
are similar to Albertas current system, including the
use o long-combination vehicles, will improve the
competitiveness o Albertas exporters.
There are also opportunities to enhance rail service.
While rail services available to Alberta shippers aregenerally satisactory and have transit speeds competitive
with U.S. railways, there is room to improve weekly
consistency and service reliability. Federal legislation
proposed in March, 2011, into which the Alberta
government provided input, would oer shippers new
measures aimed at improving the perormance o the
entire rail supply chain. Industry and government will
need to continue advocating or rail service improvements.
Improvements to air service are also a priority. Industry
and government must continue to urge the ederal
government to move orward with negotiating Open
Skies agreements. These agreements would improve
access to air transportation options or Albertans and
Alberta businesses.
Maintaining and enhancing Albertastransportation and infrastructure will
be critical for supporting Albertas
long-term competitiveness.
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Alberta Competitiveness Council Moving Alberta Forward | 23
Long-term planning will also help ensure Alberta
businesses benet rom ecient and reliable
transportation services and inrastructure. Alberta
Transportation is developing a 40-year strategic transit
transportation plan. This plan will guide investments
or the provinces economic and social growth in an
environmentally sustainable way.
Enhancing transportation will improve Albertas accessto international markets, which must be a priority or
both industry and government.
Currently, Albertas economy is highly dependent on U.S.
markets. Recent U.S. economic weakness demonstrates
how this situation poses economic risk to our province.
Market diversication is just as important as product
diversication. From a competitive standpoint, it makes
sense or Alberta to have several sizeable customers or
its goods and services. With some o the worlds largest
and most diverse markets, Asia presents a signicant
growth opportunity or Alberta businesses.
With the enactment o theAia Air Cci Ac,
the Alberta government has signalled its commitment
to establish Albertas linkages with Asia, including
priority markets such as India and China. Industry will
have an important role in helping build and leverage
those linkages to bring about new and greater economic
opportunities or Albertans.
As Alberta seeks to expand its linkages with Asian
markets, the ports o Vancouver and Prince Rupert will
have increased importance. It is in the national interest
that western Canada has improved port capacity
whether by pipeline or rail which will open the door
to Asias rapidly growing markets. Alberta must continue
to work with British Columbia and Saskatchewan through
the New West Partnership to enhance the ability o
western Canadian rms to get their products to Asian
markets using the Asia-Pacic Gateway inrastructure.
ACTION: move hIgheR densIty modules
to AlbeRtA oIl sAnds pRojeCts.
As Albertas energy production has shited increasinglyto capital-intensive oil sands projects, heavy construction
has become routine in the Athabasca oil sands area.
Most o the modules used in the construction o oil
sands projects are abricated in the Edmonton region
and shipped over the provincial highway network.
However, there are concerns that resource developers
will be nancially enticed to abricate modules oshore
and ship them to the oil sands via the United States.
This creates additional challenges or Albertas industry.
Currently, weight limits or the transportation o modulesin Alberta are set at 345,000 pounds. However, much
o the existing inrastructure along Albertas main
high-load corridor north o Red Deer may be able
to accommodate weights o up to 500,000 pounds.
In act, loads that are heavier than current limits are
oten shipped along this corridor when they are
deemed indivisible. Alberta Transportation permits
these shipments on a case-by-case basis.
A heavy module has the same dimensions as a standard
module, but can accommodate up to 155,000 additional
pounds o weight. The use o heavy modules allowsor design optimization and reduces the total number
o modules required. These improvements also will
minimize the labour required in the eld, improving
worker saety by shiting construction processes rom
the eld to the abrication yard. This can reduce overall
project costs by up to 5 percent. In the context o
multi-billion dollar oil sands projects, these savings
are signicant.
This presents an opportunity or Alberta to establish a
competitive advantage in transportation and inrastructure.
An assessment o the heavy module corridor rom the
Edmonton region to oil sands projects will be undertakento determine the easibility o increasing module weight
limits rom both an inrastructure and saety perspective.
REGULATORY COMPETITIVENESS
Regulation is essential to a well unctioning economy,
promoting environmental sustainability, and creating
a sae and just society. But outdated, duplicative,
and uncoordinated rules can impose unnecessary
compliance costs. For business and industry,
this can lower eciency and productivity, resulting
in competitive disadvantages.
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Eective regulatory systems are those that achieve
public interest goals in an ecient and aordable
manner. There are many ways to achieve this,
including: minimizing compliance costs or business,
developing evidence-based policy, and enhancing public
understanding o the law. Improving the way regulations
are developed and managed are among the best ways
that governments can promote economic development,
investment, and trade.
The Government o Alberta has a long-standing
commitment to a government-wide regulatory reorm
program ocused on producing the desired outcomes
in an ecient manner. This approach places a strong
emphasis on the ongoing review o regulation to assess
the impacts o regulation on stakeholders, including work
towards burden reduction.
The reorm program includes the use o sector-specic
reviews. The Regulatory Enhancement Project12,
or example, is pursuing enhancements to Albertasregulatory ramework or oil and gas. The goal is
to develop a regulatory system that will protect
the environment and public saety and support the
conservation o Albertas resources, while ensuring our
province is one o the most attractive places in North
America in which to invest in energy development.13
In instances where there are multiple regulators in
a single sector, opportunities exist to improve the
coordination and consistency o regulations. With
respect to trade and investment, Alberta is pursuing
better regulatory co-operation through several initiatives,
including the New West Partnership Agreement betweenAlberta, British Columbia, and Saskatchewan.
There are also opportunities to work with municipalities
in a similar ashion to support competitiveness. While
each municipality must have the ability to pursue local
approaches that refect local needs, priorities, and
issues, there is considerable benet in strengthening the
consistency o approaches. This would provide greater
predictability or business and urther support Albertas
long-term competitiveness.
Improving the eciency and eectiveness o regulatory
rameworks is an ongoing process, and work is aimed
at pursing regulatory improvements that encourage
long-term competitiveness and quality-o-lie results
by ocusing on the outcomes o regulation.
Industry also plays an important role here. Companies and
industry groups can participate in the process to help bring
about greater eciency and eectiveness by identiyingspecic areas where regulatory complexity or conusion
is hampering competitiveness.
ACTION: estAblIsh meAsuRes to RegulARly
Assess AlbeRtAs RegulAtoRy peRfoRmAnCe.
The Government o Alberta is improving the eectiveness
and eciency o Albertas regulatory environment
through a quality-based approach.
Comprehensive measures are needed to assess and
validate regulations as eective and ecient and
to understand how these eorts support Albertas
competitiveness.
For several reasons, regulations vary signicantly rom
one jurisdiction to another. Consequently, it is challenging
to compare a given set o regulations against those o
another jurisdiction.
More useul and meaningul measures are those that can
be used to assess improvements in Albertas regulatory
ramework over time, as a result o specic reorm
initiatives. Examples o measures include: A quality-based assessment o regulatory
impact analysis;
Estimations o direct compliance costs to businesses
rom regulation; and
Indicators such as the World Bank Doing Business
Indicators, which consider the requirements applying to
small and medium businesses through their lie cycles.
Perormance measures or evaluating regulatory
quality will guide work to enhance Albertas regulatory
competitiveness, and will be examined as part o the
Alberta Competitiveness Councils benchmarking eorts.
12 Inormation about the Regulatory Enhancement Project is available athttp://www.energy.alberta.ca/Initiatives/RegulatoryEnhancement.asp
13 The Regulatory Enhancement Project did not include an examination
o First Nations consultation processes. The Government o Alberta
is currently engaged with First Nations in a review o Albertas First Nation
Consultation Policy on Land Management and Resource Development
and associated guidelines and is committed to consulting with First Nations
in accordance with this policy. The government is committed to ullling
its legal obligations to First Nations.
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Agriculture Grains and Oil Seeds
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AGRICULTURE GRAINS AND OIL SEEDS
Albertas armers are stewards or 52.1 million o
Albertas 157.7 million acres o land. They produce
massive exportable volumes o wheat, malting barley,
canola seed, eld peas, and oats. Some have also
diversied into dierentiated products such as small
grains and organic grains. Under this initiative, the taskteam has ocused on the grains and oil seeds sector.
There are signicant economic opportunities ahead or
Albertas grains and oil seeds sector. Estimates suggest
the worlds population will increase to about 9.3 billion
people by 2050, up rom about 6.9 billion in 2010,
led by growth in developing countries.14 Over the next
ew decades increasing prosperity among consumers,
particularly in developing and emerging economies such
as China and India, will lead to rising demand or imports
o ood and agricultural commodities.
These developments will mean new customers and risingdemand or grains and oil seeds products. To capitalize
on those opportunities, however, Albertas grains and oil
seeds sector must continually enhance its competitiveness
through research and innovation; market access and
market development; rural renewal; and improved policy,
regulatory, and institutional systems.
Some o the actors that aect the grains and oil
seeds sector, such as transportation and regulatory
competitiveness, are not restricted to the sector and
can be addressed in a broader solution. There are also
a number o sector-specic issues (discussed below)
that require attention. The Council has identied anumber o actions to address these issues enhance
Albertas competitiveness in grains and oil seeds.
AGRICULTURAL POLICY
As an area o shared jurisdiction, agriculture policy is
set by both the ederal and provincial governments.
National policy rameworks in the area o agriculture
are established through negotiation between the
ederal, provincial, and territorial governments and
implemented through a series o agreements between
the governments. The ederal government partially unds
the costs o these agreements and demands a certain
degree o comparability in agriculture programs and
services between jurisdictions. Alberta and some other
provinces have negotiated some regional fexibility
in the design and delivery o their programs.
Despite this collaborative approach and policy evolution
since the mid-1990s, certain areas o agriculture policy
remain challenging. For instance, the bulk o government
unds remain devoted to income stabilization programswhich are not particularly eective. By comparison,
insucient attention is being paid to areas such as
research, inrastructure, skill enhancement, and business
adaptation, which are needed to enhance the sectors
long-term competitiveness.
14 United Nations Population Division.
Summary statistics grains and oil seeds
2005 2006 2007 2008 2009 Average
Farm Cash Receipts
($ billions)
2.8 3.1 4.2 6.2 5.3 4.7
# o Employees
(thousands)*7.7 8.3 7.9 9.0 10.0 8.6
% o Alberta GDP 2.6 2.2 2.2 2.6 2.1 2.3Value o Exports
($ billions)
2.1 2.7 3.4 5.3 4.7 3.7
* Excludes milling
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Federal legislation and policy concerning the marketing
o wheat and barley continues to present a major barrier
to industry competitiveness. Alberta producers and
shippers o wheat and barley products should be ree
to sell their grain and products to whomever they wish,
including the Canadian Wheat Board i they so choose.
Individual armers know what is best or them to maximize
returns, and must have the reedom to engage and tradewith customers in domestic and international markets
on their own terms. The success o Alberta producers
in growing and marketing canola, pulses, and oats
all non-board crops demonstrates that marketing
choice would enhance Albertas competitiveness
in wheat and barley.
ACTION: ContInue to suppoRt mARketIng
ChoICe foR wheAt And bARley.
While there are no easy solutions to the challengeo ederal marketing restrictions in wheat and barley,
the issue remains a priority or Alberta.
The Government o Alberta will continue to work with
the Alberta Grains Council to advocate or marketing
choice or Albertas wheat and barley producers.
The government will utilize every avenue and
opportunity available to it to consult and coordinate
eorts with other western provincial governments
and the ederal government to advance the Marketing
Choice le so Alberta armers are able to sell their grains
to whomever they choose.
ACTION: Adopt And AdvAnCe polICIes thAt
enAble A moRe CompetItIve And InnovAtIve
IndustRy.
In terms o general agricultural policy, the Government
o Alberta will advocate or policies and programs that
will enhance the sectors long-term competitiveness
through ederal-provincial negotiations. The current
ederal-provincial agriculture agreement, called gri
frar, expires in 2013. Negotiations are under way
or its replacement, gri frar 2.
The Competitiveness Council supports Alberta
championing a negotiating position calling or policies,
programs, and services important or the industrys
long-term competitiveness. This includes:
Strategic emphasis on programs aimed at
research and innovation, market access, business
development, ood saety, crop and animal health,
and environmental stewardship, which will help thesector adapt and compete in the long term;
Within the