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Northerners have one choice for cluster.

Vic Power, the mayor of Timmins, is not happy. He has been hearing talk about making Sudbury the mining capital of Canada. He thinks Timmins should be the mining capital of Canada. I know what Vic thinks because reporters from Timmins called me to find out what I thought about what he thought.

As a professional economist, I know that northerners have a simple choice-Sudbury or Toronto. We either build one world-class mining supply cluster in Northern Ontario, or the industry goes elsewhere. It has to be in a city with a research university to drive innovation. It has to be big enough to have a "thick" labour market. It has to have a collection of firms that already competes with southern centres. The economist in me tells me the debate is already over. The North has only one candidate.

To the amateur political pundit in me, the situation looks very different. Knowing how politics works in the North, I think Vic may be shooting Northern Ontarians in their collective feet.

Here is why. To protect the interests of his city, Vic will put pressure on Thunder Bay's Joe Comuzzi. Joe is the Secretary of State for the Federal Economic Development Initiative for Northern Ontario (FedNor). Vic will try to convince Joe that Timmins should get a share of any federal projects in Northern Ontario.

Vic is a very smart guy. He was mayor when Timmins identified its mining cluster as a growth opportunity. That report was published in 2000, when Sudbury was still trying to diversify away from mining. Sudbury was chasing windmills.

Because he is so politically astute, Vic will probably recruit North Bay Mayor Vic Fedeli to convince Joe that Timmins and North Bay should get equal billing with Sudbury. North Bay has its own collection of companies that supplies the mining industry.


Fedeli is another smart guy. He ran a very successful advertising agency and now he is making dramatic changes in North Bay. North Bay's Vic will probably support Timmins Vic because he also fears that if Sudbury wins the title of Canada's centre for mining supplies and services, their cities will lose out.

They are wrong of course--the more international business Sudbury attracts, the more they get. The really scary prospect for North Bay and Timmins is that Sudbury might fail in its bid to become the leading supply and service centre for Canada's mining industry. If that happens, most of the businesses will go to Toronto and Vancouver and Quebec, not Timmins and North Bay. In the longer run business will go to Chile, South Africa and Australia, and not Canada. If the two Vics play "me too" at this stage, we all lose. They will be acting like good, traditional local politicians. And they'll shoot everyone in Northern Ontario in the foot at once.

Right or wrong, they will put pressure on Joe Comuzzi. We will have an ex-high school counsellor and an advertising man telling a lawyer how to support economic development in Northern Ontario.

Since FedNor is part of Industry Canada, Joe will have to talk to the Minister of Industry, David Emerson. Emerson is the new Minister of Industry, hand-picked by Paul Martin for the job.

This is where the story gets nasty. David Emerson is an economist with a PhD from Queen's University. He has served as Deputy Minister of Finance in B.C., as president of a major forestry company, as president of the B.C. Trade Development Corp. and head of the Vancouver International Airport Authority. He is the best-equipped minister of industry since C.D. Howe.

How will David Emerson respond to Joe's message? It isn't hard to guess. He will be looking for ideas that fit Martin's emphasis on innovation and cluster development. The message for Timmins doesn't fit.

In fact, the message from Timmins contradicts the research and contradicts the policy. If Joe delivers Vic's message, Emerson will decide that the Secretary of State for Northern Ontario doesn't understand the reality of economic development. He may decide to concentrate on the regions that are ready to play economic development hardball instead of political football. Joe and Northern Ontario may find themselves being ignored.

Dr. David Robinson, PhD, is an associate professor of economics at Laurentian University. He can be reached at
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Title Annotation:Economically Speaking
Author:Robinson, David (American basketball player)
Publication:Northern Ontario Business
Geographic Code:1CONT
Date:Aug 1, 2004
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