3.1 Capturing Strategic Opportunities

Diverse New Opportunities for Growth

Our people have much creative energy. In the consultations, we heard countless new ideas and innovative approaches to strengthening and diversifying our economy. We heard about specific new business opportunities, we heard about new markets for our products and services, and we heard about the many competitive advantages that we possess. Opportunities highlighted fall broadly into three categories - traditional, maturing and emerging sectors of our economy

"In 1967 Beothic Fish Processors processed just one species of fish - salted cod - and employed a maximum of 50 workers. In 1998, the company processed 21 species of fish.... (and created) the equivalency of 250 full-time jobs."

-Mr. Harry Harding, Beothic Fish Processors Ltd Wesleyville

Traditional Sectors   Opportunities were highlighted in traditional sectors where new approaches and markets are breathing new life into established sectors such as the fishery, forestry and agriculture industries. People spoke about new opportunities arising from value-added products, the use of modern technology, moving into new or high-end niche markets, and increasing productivity to boost sales and jobs.

The new fishery is focusing on value-added and quality. Many people spoke with great hope for a future in the professional fishery. They want a modern harvesting and processing industry that provides a career, not a few weeks work. The fishery hit the $1 billion mark in production value last year and can grow even further with the right approach.

"...we have superior advantages for such markets as organic foods in a global market."

- Dr. Hilary Rodrigues, IAS Committee for Agrifoods

Diversification is paying off for the agriculture sector was well. Consumer tastes are changing all over the world. Growing demand is opening opportunities for high-value crops that can be grown in Newfoundland and Labrador. We are moving from subsistence root crop production to a variety of crops more suited to consumer demand and crops that we can grow better than other regions.

"Our forestry (industry) is undergoing a renaissance... partly because of excellent market prices, but more importantly, it is a result of a new emphasis on maximizing the resource."

- Mr. Dave Tulk, Kittiwake Economic Development Corporation

The forest products industry, a key part of the provincial economy for many years, is showing new potential. Here again, the new opportunities are in value-added products. Integrated sawmills are providing an exciting example of value-added production, with full utilization of raw materials. New technologies are greatly increasing lumber yield from timber. Former waste from mills is now being reused in new products or to generate power for sawmills. There is significant untapped potential in Labrador as well.

Maturing Sectors   Maturing sectors of our economy such as tourism, manufacturing and the petroleum industry have grown significantly in recent years and are becoming major job and wealth generators in the province.

The growth of the tourism sector in Newfoundland and Labrador has been phenomenal. Bolstered by special celebrations such as Cabot 500 and Soiree �99, the tourism sector is offering higher quality products and accommodations than ever before. Through more aggressive marketing, we are attracting more and more visitors to our shores each year to share our culture and the incredible beauty of our land. Demand for adventure tourism and eco-tourism products is growing internationally and Newfoundland and Labrador is very well placed to take advantage of the tremendous growth in these areas.

"...with 4 trillion cubic feet of natural gas, and an undiscovered potential of some ten times that amount, we have the resource base for a strong, vibrant and sustainable oil and gas industry in this province."

Capt. Mark Turner, Newfoundland Ocean Industries Association

The petroleum industry has been active in the province for twenty years. It has generated a multifaceted service and manufacturing sector. Local capacity has grown along with the industry - particularly with Hibernia construction and production. The professional and technical firms that grew along with offshore oil development are now branching out. They are tackling projects outside Newfoundland and Labrador. We are making our mark on the world petroleum stage. Our natural gas resources offer significant new growth potential and diversification opportunities in this industry.

"Small scale manufacturing ... is an area which we expect to see growing in the next few years..."

- Ms. Cindy Colosimo Robbins, Labrador Straits Development Corporation

Manufacturing - specifically small scale manufacturing - has taken hold as a real growth sector for the province. Firms in areas such as Bishops Falls, Corner Brook, Centerville and many more are finding success in value-added production. These firms are competing in high-value, niche markets where quality outweighs quantity. And they are competing successfully.

Emerging Sectors   There is even more on the horizon in emerging sectors such as information technology, environmental industries, aquaculture, marine technologies, aerospace, biotechnology, cultural industries, educational and other knowledge-based export services, to mention just a few. These new sectors hold tremendous growth potential for all of Newfoundland and Labrador.

• We are only just beginning to tap the potential from advances in information technology. As an enabling tool, it is allowing firms to establish in far more remote locations than was possible even ten years ago. Firms in rural communities are able to overcome traditional obstacles related to distance by doing more business electronically. The business of creating information technology solutions is also providing incredible growth for Newfoundland firms in their own right. The information technology sector is among the fastest growing new sectors of our economy.

"...we can solve our own environmental problems and export the solutions to other countries. "

-Mr. John Drover, Newfoundland Environmental Industries Association

• The environmental services industry is another of the emerging industries that is gaining prominence as we enter the 21st century. Recycling, site reclamation, and waste management are but a few of the opportunities for Newfoundland and Labrador firms in this dynamic sector. We need to view environmental stewardship as an opportunity for development, not as an obstacle.

"Newfoundland and Labrador mariners work nationally and internationally while maintaining their home in this province."

-Mr. John Connors, Fisheries and Marine Institute of Memorial University

• Marine technology is another industry that is building on the existing skills and experience of Newfoundlanders and Labradorians to create jobs in the new economy. Highly skilled technicians, navigators and ships captains are educated at the Fisheries and Marine Institute of Memorial University. These professionals are becoming an increasingly important link into the lucrative marine technologies sector. Those links are beginning to pay off for the province�s economy and have significant growth potential, particularly for rural Newfoundland and Labrador.

• In the fields of nutriceuticals and biotechnology, efforts to support industry development are yielding real dividends. Native berries and herbs are being used in new natural medications - a market that is growing rapidly throughout North America and the world. Several firms are also taking advantage of the incredible advances in biotechnology to drive new commercial ventures.

"(Artists) represent a significant cluster of economic activity in their own right...."

-Ms. Pam Hall, Association of Cultural Industries of Newfoundland and Labrador

• Cultural industries are moving into the limelight with a new sense of economic potential and business acumen. Film, music and the performing arts are becoming stable, viable business opportunities that build on the rich wealth of talent and culture across the entire province. It is appropriate that here in Newfoundland and Labrador, in the era of the knowledge economy, it is our cultural identity that is coming to the forefront along with technical knowledge as potential major economic generators.

"...there exists in Corner Brook an educational infrastructure and knowledge base that has the potential of being developed into a major economic generator."

- Mr. David Reid, Humber Economic Development Board

• Many Newfoundlanders and Labradorians are selling their technical expertise internationally. The export of knowledge-based services is growing in the province. In educational services in particular we are now in a position to expand the possibilities for markets and products - bringing new money and jobs into our economy through exports.

• Aquaculture is changing in Newfoundland and Labrador. The early days of research and development are paying off - we are now focusing on those species where competitive advantages exist. Advances in production efficiency also mean that the industry is becoming a more stable provider of jobs and investment. The focus is on creating a competitive, self-sustaining industry.

The Social Economy

The social economy provides a diverse range of goods and services, and employment opportunities through volunteer networks at the community level that neither the private sector nor government is well positioned to meet.

"Our programs are a wonderful marriage of social, economic and community development."

Ms. Catherine Barrett, Waterford Foundation (Evergreen Recycling and Mill Lane Enterprises) St. John�s

An example is Evergreen Recycling and Mill Lane Enterprises in St. John�s. This enterprise is a non-profit organization, administered by the Waterford Foundation, with a mandate to deliver community-based vocational rehabilitation programs for people with mental illness. This enterprise operates a recycling and woodworking/textile business that employs 120 people who have moderate to severe mental disabilities. This initiative serves a valuable social objective (by providing participants with job skills, an income, and greater self-esteem) but also provides a valuable community service (environmental recycling) and contributes to the economy by providing services and goods that are in high demand.

The social economy meets a combination of economic and social objectives at the community level. In some cases, these initiatives may have the potential to evolve into market-driven enterprises; in other cases, they represent an investment in social infrastructure, community services or community economic development. The involvement of the community-based sector, sometimes referred to as the "third" sector, is essential in a vibrant economy.

Many presentations made in the consultations focused on the contribution and potential that the social economy could play in the province�s overall jobs and growth agenda.

"... small businesses are the main engine of growth, and SABRI is confident that many opportunities can be pursued with individual entrepreneurs in small enterprises."

Mr. Dennis Coates, St. Anthony Basin Resources Inc.

Small Business

It was repeatedly stressed throughout the consultations that a balance needs to be struck between larger scale developments and the need to foster the growth of small enterprises in all areas of the province. More than 95% of all business enterprises in Newfoundland and Labrador employ fewer than 50 people - the upper limit most often used in defining small business - and almost 80% of all businesses in the province employ less than five people. Small businesses create more jobs each year in Canada than any other component of the economy. The small business sector was identified as a major economic opportunity whose potential has yet to be fully tapped in the province, especially in rural areas.

Priorities for Action

Government will give greater priority and emphasis to small business development in its renewed jobs and growth agenda, through new initiatives on the tax, regulatory and direct investment/support fronts, championed by the Department of Development and Rural Renewal.

Renewed frameworks to guide long term development of traditional, maturing and emerging sectors of the economy are underway. In the interim, government will give the following areas immediate attention in response to strong and clear representation made in the consultations. It should not be interpreted, however, that other areas of opportunity raised in the consultations are not important in government�s overall agenda.

• A comprehensive natural gas development strategy will be prepared in consultation with major stakeholders, in recognition of the economic potential of our natural gas resources and the opportunity to significantly diversify the petroleum industry overall.

• Resources for the quality enhancement program in the Department of Fisheries and Aquaculture will be doubled from $250,000 to $500,000 in 2000-01. This will build on significant progress already being made in this area. Considerable attention was given to this issue in the consultations as a means of gaining maximum economic benefit from the fishery.

• The Department of Forest Resources and Agrifoods will work in cooperation with aboriginal groups and communities in Labrador to develop the wood resources of Labrador. A request for expressions of interest related to the development of a sawmill industry in the Cartwright area was recently issued. Government is also exploring opportunities to develop the industry more fully in the Postville region of Labrador.

• The Department of Tourism, Culture and Recreation will increase the annual grant to the Newfoundland and Labrador Arts Council from $500,000 to $750,000, a 50 percent increase, in order to stimulate early stage creative development that contributes to eventual economic vitality and growth in our evolving cultural industries.

• The Department of Mines and Energy will extend the current mineral exploration assistance program from three years to five years, and increase funding from $2 million to $2.25 million in 2000-01. This will provide added incentive for mineral exploration, which is the essential first step in developing new mines in the province.

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