Canadian International Council



Canadian International Council

October 09, 2012 08:42 ET

New Report Commissioned by the CIC Calls for Sovereign Wealth Funds, a Price on Carbon, and a National Natural Resources Plan

TORONTO, ONTARIO--(Marketwire - Oct. 9, 2012) - A new report released today by the Canadian International Council (CIC) argues that without strong leadership and collaboration, Canada risks losing an opportunity to become a real resource superpower.

The 9 Habits of Highly Effective Resource Economies: Lessons for Canada looks at how other countries manage their resource wealth and argues that our natural resource sectors need to adapt to be more competitive in a world where economic and political power is rapidly shifting. The commodity boom that began in 2003 once again made the resource sectors of vital importance to the Canadian economy. But unlike in past commodity booms, we can no longer rely on simply hewing wood and drawing water to compete. Canada needs to do more to add, extract, and build value around its natural resource industries.

Last year, the top Canadian merchandise export to every one of its major trading partners was a natural resource, but governments in Canada have come late to the realization that they must be more deliberate and united in their approach to resource development if they are to spread the wealth, not just over regions but also over generations.

"Canada's resource peers, like Norway, Finland and Australia, offer lessons that too often are overlooked in our domestic debate, which is narrow, partisan, frequently uninformed, and almost entirely focused on the Alberta oilsands," said Madelaine Drohan, author of the report. "This report sets out the basket of issues that must be addressed now if Canada is to have a proactive rather than reactive resource policy."

Drawing on more than 160 interviews with experts both in Canada and abroad, and extensive consultations with research institutes, policy-makers, multinational companies, and multilateral organizations, the report points to the following nine habits:

(1) Save your money (think sovereign wealth fund). A growing number of countries treat resource revenues as capital and not income. Canada is not among them.
(2) Don't stand still. Add, extract and build value. We're rich in resources but could be richer still if we did more with what we have. Government can help business find the answers.
(3) Research together or fail separately. Crisis is teaching Canadian resource firms the virtues of collaboration - a lesson their global competitors learned long ago.
(4) Keep up with the world: Put a price on carbon. Canada must find a better balance between resources and the environment. Pricing carbon is a necessary first step.
(5) Get on the global boat and cast wide trade nets. Trade patterns are changing. We need to go global and think less about finished products and more about value chains.
(6) Don't bar the gates: Foster home-grown champions. Governments must make it easier for Canadian resource firms to become global players. Keeping investment out is not the answer.
(7) Use your aid to help strengthen good governance overseas. Canada should play to its strengths with its official aid. Focus on resource governance and collaborate with like-minded donors.
(8) Stop the temporary labour addiction, find a long-term cure. Over-use of temporary foreign workers is a short-term fix. The solution includes allowing in more permanent residents and hiring more women and aboriginal workers.
(9) Make an inclusive national plan (hint: It's more than just energy). Other countries have been more strategic in developing natural resources. Federal-provincial infighting is holding Canada back.

"The CIC board commissioned this report in order to inform and encourage a broader national conversation about what needs to be done to ensure Canada's future prosperity. I am confident that this stimulating and timely report serves that purpose," said Jennifer Jeffs, president of the CIC.

The report was written by Madelaine Drohan, an award-winning journalist and Canada's correspondent to The Economist.

The report can be downloaded at: www.opencanada.org/9-habits. The report webpage includes expert commentary, a bibliography, and additional resources. The CIC is also holding a series of live, online chats with national and international experts in the key policy areas covered by the report. Join the conversation online if you want to ask a question or just want to know more. The first online chat takes place on October 10 at 12:30pm ET with Daniel Dumas of the Commonwealth Secretariat, an expert in sovereign wealth funds. The full schedule for the chats will be available at www.opencanada.org/9-habits.

The Canadian International Council (CIC) is The Canadian International Council (CIC) is Canada's foreign relations council. It is an independent, member-based council established to strengthen Canada's role in international affairs. The CIC reflects the ideas and interests of a broad constituency of Canadians who believe that a country's foreign policy is not an esoteric concern of experts but directly affects the lives and prosperity of its citizens. The CIC uses its deep historical roots, its cross-country network, and its active research program to advance debate on international issues across academic disciplines, policy areas, and economic sectors. The CIC's digital media platform, OpenCanada.org, is Canada's hub for international affairs. The CIC's research program is managed by the national office in Toronto. Its 16 branches across Canada offer CIC members speakers' programs, study groups, conferences, and seminars.

Contact Information

  • For further information or to schedule an interview
    with the author, please contact:
    Canadian International Council
    Laura Sunderland
    416.946.7071
    lsunderland@opencanada.org