Alex Binkley on agrifood recognition

The Binkley Report

Alex Binkley is a foremost political and economic analyst, whose website is www.alexbinkley.com. Readers will be aware that his columns in True North Perspective have foreseen political and economic developments in Canada. In this edition ...

Finally some recognition for agriculture and food

'It’s great news' says Jeff Neilsen, President of Grain Growers of Canada

By Alex Binkley
True North Perspective

Although it provides one in eight jobs in Canada and earns about 7% of the GDP, the agriculture and food sector gets little recognition from politicians and the public for its economic importance. It also has to contend with a public awareness that’s about on the level of the kid’s story Old MacDonald Had A Farm.

That could change if federal decision makers and business commentators heed the latest report from the federal economic advisory council, headed by Dominic Barton, outlining the future prospects for Canada’s economy. It urges the government to collaborate with the private sector to turbocharge the economy.

It notes the agrifood sector employs 2.1 million Canadians and accounts for 6.7% of GDP, with lots of potential for growth. Canada ranks 5th in agriculture exports and 11th in agrifood exports.

“Enabling the sector to move up to 2nd place in agriculture and to 5th place in agrifood would imply an additional U.S. $30 billion in exports in today’s distribution of global export shares, equivalent to nearly 2% of current GDP.”

The report recommended that agrifood be used as a pilot project for boosting sectors “where Canada has a strong endowment, untapped potential, and significant global growth prospects.” To encourage those sectors to grow the national economy, the government should “take a focused approach that removes barriers and galvanizes the sector around a bold growth agenda.”

Agrifood along energy and renewables; mining and metals; healthcare and life sciences, advanced manufacturing; financial services; tourism and education are the sectors where government, “in concert with the private sector, can take a targeted approach that would unleash the sector’s full potential.

“Such a partnership would help raise our collective ambition and unleash Canada’s real and inclusive growth potential.

“The Canadian agrifood sector has great potential, given the large natural endowment of water and arable land, distinctive record of accomplishments in research, and exceptional base of companies and entrepreneurs,” the Council points out. “This sector also has exposure to favourable global market trends including demand from fast-growing Asian economies where protein consumption is on the rise.

“These assets, coupled with the scale of the existing obstacles, provide the potential for material economic gains for Canadians while also providing a blueprint for how the government and private sector may work together to unleash Canada’s potential in other sectors.”

The federal government should “launch an agrifood pilot by convening private and public sector stakeholders, identifying major obstacles to growth, setting an aspiration (a vision and quantified goals), and recommending concrete actions,” the Council urges.

A winning strategy to unlock the growth potential of the agrifood sector could be “replicated in at least three other sectors over the next three years, and then up to five to seven sectors over time,” its adds.

The Council recommended a toolkit to leverage growth that includes a federal infrastructure bank, a foreign direct investment agency, and a method for catalyzing innovation marketplaces.

“While the actions we propose will need to be refined with the help of the agrifood sector, the potential benefit is substantial. The government and agriculture leaders need to identify the most important obstacles to growth, take clear policy actions to overcome them, galvanize the sector around a growth agenda, and tracks its progress “to ensure the policy actions have supported economic activity within the sector.

“Undertaking these tasks well requires a deeper level of collaboration between business and government than has historically been the case,” the Council points out. “The private sector must play a central role in defining what obstacles to remove to help the sector grow and to compete globally.

“The need for a focused, sector approach to economic development is particularly acute for Canada,” it continues. “Although our economy is advanced, it is small in absolute terms, and particularly small relative to the United States. Achieving global scale and competitiveness requires clearing the path to growth in our most promising sectors.”

The Council says government and the private sector can collaborate on removing obstacles barriers to growth “through well-designed policy actions. The private sector’s involvement is necessary because it is best placed to identify the genuine obstacles to growth within any specific sector. The government’s involvement is equally necessary as it is best placed to determine that removing a particular barrier is genuinely in the public interest.”

While well-designed environmental or labour regulations have their role, government and the private sector can identify that which are more hindrance than help.

“Details within each sector need to be carefully examined.”

Many other countries have adopted this approach and its’ time for Canada to step up.

“This a great opportunity for us as we move forward,” says Ron Bonnett, President of the Canadian Federation of Agriculture. “The report really recognizes our potential for growth.

“We can use the report in the development of a national food strategy and the Agriculture Policy Framework. We need to work together across the sector to achieve what the report proposes.”

“It’s great news for us to be recognized like this,” stated Jeff Neilsen, President of Grain Growers of Canada. Farm groups reached out to the economic council and their message about the potential of the sector was understood. “It understood the farm sector supports the whole economy and that technology is very important to us.”

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