When Steve Demmings was at a mining conference in Toronto in March, he sat in a room with a couple of hundred Chinese investors listening to Canadian mining companies making their pitch for investments.
Demmings, CEO of the Thunder Bay Community Economic Development Commission, was making the point that there is huge demand from the Chinese for resources that are abundant in Western Canada.
But not only is there demand from Asia, there is increasing competition with First World economies.
“The U.S. may be trying to get through the recession, but it’s not stopping China from making massive investments in infrastructure,” Demmings said. “They will be even more fearsome competitors on the other end of the deal. That’s why we need to have the global supply chain in order.”
Demmings has obvious reasons to be supportive of Livio Di Matteo, the Lakehead University economics professor who is developing a concept of a regional midcontinental cross-border economic development zone, including northwestern Ontario, which Di Matteo has dubbed Heartlandia.
Di Matteo presented a paper on the subject to the Frontier Centre for Public Policy on Wednesday. Regardless of one’s opinion on the need for another regional organization, Di Matteo said economies are increasingly interconnected.
“The global financial crisis has been a real wake-up call,” he said. “Until recently, I think a lot of people did not know how integrated their economies were.”
That example may be a negative instance, but Di Matteo points out the recession will eventually end and there will be increasing demand for western Canadian resources.
“I believe the West is poised for long-term growth,” he said.
If that’s the case, then beefing up regional infrastructure and expanding supply chains would seem to make sense.
But some believe it might be counterproductive to create another cross-border organization. (Di Matteo suggests something akin to the Pacific NorthWest Economic Region, with its $1-million budget and staff of eight people in Seattle.)
“I think that the concept is an interesting one,” said Chris Lorenc, a board member of CentrePort Canada and president of the Manitoba Heavy Construction Association. “No question, there is a lot of economic activity in the area. But I would be careful about starting too many splinter initiatives and then have none of them get underway.”
Lorenc said the concept of Heartlandia is essentially being addressed by relationships Manitoba has with NASCO (North America’s SuperCorridor Coalition) and the province’s international gateway strategy.
Lorenc said the idea of trade development is to expose yourself to opportunities that are not domestic in nature, because those are more likely to continue on their own.
Those regional cross-border interconnections have grown for more than a century. Recent data in Businessweek magazine graphically shows just how similar the economies of the U.S. Great Plains states are to the Canadian Prairies.
Saskatchewan and Manitoba are the strongest Canadian economies right now, and the same can be said of our southern neighbours. Those states feature the lowest unemployment rates in the United States as well as the lowest rates of mortgage delinquencies.
Di Matteo has no vested interest in whether any formal entity like Heartlandia is ever created.
He said the bottom line is the attempt to make cross-border activity easier, getting people working as a team more often and to capitalize on what may be a long growth cycle for the West.
