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Rural rooters.

Bold initiatives build rural business

Armed with vital statistics from their geographic regions, Manitoba's regional development corporations have doggedly pursued the people who decide where a new factory will be located. That mandate dominated when RDCs were designed 31 years ago. They were first suggested in a report of the Committee on Manitoba's Economic Future. RDCs still jump at the chance to woo outside investors, but today they are also a life support system for the small business community that already exists within their boundaries.

Sam Schellenberg's role is a prime example of how things have changed. As general manager of the Pembina Valley Development Corporation in southern Manitoba, Schellenberg helps keep struggling businesses from going under. His group also works to help start new businesses. He points to 15 new, non-manufacturing businesses which have started up in the past year as proof -- all of them helped to some degree by the RDC.

His four-member office also spends time with individuals who have a proposal for starting a company. The RDC runs the Pembina Valley Learning Centre, a satellite office of Red River Community College. The centre offers courses to help unemployed people upgrade their skills during the day. It also offers evening classes on a wide range of subjects, from English as a second language to university entrance programs. More than 300 people were enrolled in the evening classes this past winter.

The Pembina Valley area has been especially hard hit, during the last few years, by the stampede of shoppers heading south of the border. But Schellenberg says, despite "heavy losses" to the U.S. combined with the on-going sting of the recession, "retail has survived well and there's been some growth."

Within the Pembina Valley, the Town of Carman has set up its own community development corporation. Ron Funk is the development officer whose primary task is to encourage people to live in Carman.

Many seniors are doing just that, according to Funk, so the town is becoming a popular spot for retirees and tourists. A recent success was four bookings by a bus tour company to bring day-trippers to the town. Another plus, says Funk, is that no businesses closed during the recession.

Schellenberg says a big challenge facing the entire Pembina Valley region is that people are weary. "After the hard work of just surviving the recession we have to summon up the energy to put forward new initiatives," says Schellenberg. Finding that energy, and the new ideas that go with it, is not easy. But if the business community in the Pembina Valley can maintain its current strength, it isn't doing badly.

The area is home to 50,000 people and although agriculture is the largest industry, there's a lot of diversification. There are 90 different industries in the region, and they have a strong export market; 70 per cent of the non-agricultural production sells out of the province and about a third of that goes out of the country. To help maintain this performance and to stimulate people to build on it, Schellenberg says his office takes a "holistic approach" to economic development. He's not simply interested in luring the big employer to set up shop in Altona or Morris, he also wants to help sort out the wide range of problems faced by local business -- from infrastructure issues to staff training.


Maurice Bouvier of the Interlake Development Corporation in Arborg thinks along the same lines. According to a recent list of highlights in the RDC "...Interlakers have realized that most economic development is driven from within a region; firms aren't lured to an area very frequently or easily. This attitude has been seen in a number of locally driven projects." Some of those recent successes include a seed company which has developed a golf grass that tolerates our harsh climate; a group of farmers who are developing plans to operate an alfalfa dehydration facility, with possible markets in Japan and Korea; and in Teulon, a company called Care Corporation has set up a factory to produce environmentally-friendly feminine hygiene products.

"Ideas that come from within |the Interlake~ are the future," says Bouvier.

Because of the history of the region, plus reasonably priced land and a huge forage crop, agriculture continues to be the main business in the Interlake. The RDC is trying to diversify the economy by encouraging tourism. Bouvier refers to it as "the driving force of the economy." Apart from the blessings of nature -- plenty of beaches, lakes, caves and Oak Hammock Marsh -- the area, which is home to about 55,000 people, tries to lure more by boasting about the new resort at Gimli, Gull Harbour Resort, lots of golf courses and special tourist attractions held year round.


Tourism is also major force in the Eastman Regional Development Inc. area. The region occupies a strip that hugs the Manitoba/Ontario border and includes the popular Whiteshell and Nopiming provincial parks. But the RDC doesn't simply rely on the parks to provide the economic life blood of the region. It publishes a newsletter, has produced a video, and regularly puts out a business opportunity catalogue, and a business directory. It has developed a kit on entrepreneurship which is used in the high schools, and collects all sorts of data on the region. It also works with community groups like local chambers of commerce. "We're their resource people," says Marie Louise Mendro, general manager of the RDC.

As in many rural areas, agriculture is one of the top industries. The Eastman region has 4,000 farm operations which generate more than $340 million in revenues each year. These farms produce 30 per cent of the province's hogs and 38 per cent of our milk, which means $50 million in revenues. The area has a large poultry and egg production capacity with 60 per cent of Manitoba's laying flock -- another $30 million in sales. Turkeys are also big business -- 90 per cent of the birds and 75 per cent of the broilers in the province are processed in modern processing plants in the southern part of the region. Mendro says the RDC looks for ways to help this sector. This year it will hold a forum for farmers to explore new ways to add value to agricultural products before they are shipped out of the region.

Portage La Prairie

One of the success stories in rural economic development in Manitoba comes not from an RDC, but from the City of Portage la Prairie. Tim Feduniw, director of economic development for the city, says since 1989 there has been $269 million in new economic activity. A large chunk of that sum -- $170 million -- was the cost of converting the Canadian Forces base into a private flight training school. Other successes include almost $10 million spent by Calwest Textiles Incorporated, which has set up shop in the former Campbell Soup plant; $17 million for an oat processing facility; and a $1 million medical clinic.

"We don't sit around waiting for things to happen," says Feduniw. "We instigate it." One of the ways they attract attention is to send information on the city, along with a Christmas card, to every Canadian consulate in the world. Feduniw says one of the messages he is trying to get out is that Portage is poised to take advantage of a new trend in North America. "There's a shift away from urban areas," he says. "Companies like to be in a rural area." The attractions are lower overhead, fewer social problems and a "high loyalty" work force.

NorMan Region

The NorMan Regional Development Corporation also has loyal workers -- the trouble is, there are not many of them. The huge RDC, which stretches across the north of the province, has fewer than 30,000 residents. Apart from resource industries, the Port of Churchill and a small service sector, economic activity is sparse.

Coreen Kostal, development officer for the RDC, says two projects are currently awaiting funding. One is a feasibility study to look at opening a phosphate fertilizer plant and the other is an investigation of how raw fish processing can be improved and new markets found.

All RDCs in the province have been hit with funding cutbacks. This has hurt, since the Corporations get about 75 per cent of their operating cash from the provincial government -- the rest comes from member communities and businesses. One obvious impact of having fewer dollars is less trips to trade shows outside of Manitoba.

With money tight, it is not surprising that the RDC's are concentrating efforts on keeping local economic activity healthy. Many people are not aware of the change though -- they still think the RDC's are actively "prospecting" outside of the province.

Sam Schellenberg in the Pembina Valley says it is time to take another look at the role of the regional development corporation. "What we promote enhances the tax base considerably, but what we need is a renewed sense of discussion of what we expect from rural economic development."
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Title Annotation:regional development corporations
Author:Ryan, Bramwell
Publication:Manitoba Business
Date:Jun 1, 1993
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