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Canada still lags in innovation performance


February 4, 2010
by PLANT STAFF

Canada gets higher innovation marks for the number of scientific articles per one million population.

Photo: PLANT Stock

OTTAWA: Canada is home to some great innovators: most famously Research In Motion and its ubiquitous Blackberry come to mind; but when it comes to innovation, we’re a D-level performer, according to a Conference Board of Canada ranking.

Its How Canada Performs report card places Canada 14th among 17 peer countries. Of the 12 measurement indicators, we get one B, two Cs and nine Ds. That lone B is for the number of scientific articles published per one million population.

And Canada ranks second to last on the new indicator—the number of international trademarks filed per million population—a measure of services sector innovations and non-technological innovations. Ten countries had at least twice our share of trademarks by population.

“Canada is well-supplied with educational institutions and carries out scientific research that is well-respected around the world,” said Gilles Rheaume, vice-president, public policy for the Ottawa-based research firm. “But, with a few exceptions, Canada does not successfully commercialize its scientific and technological discoveries into world leading products and services. Canadian companies are rarely at the leading edge of new technology and find themselves a step behind the leaders.”

Rheaume told PLANT there are “many, many factors” in play, among them, lack of a an inviting domestic market for innovative new products and services; difficulty accessing risk capital; and the need for a more integrated national strategy from government.

He said the federal government is currently focused on science and technology but pays little attention to commercialization. Rheaume stressed the importance of developing domestic markets: by providing incentives and establishing market standards, companies can nurture their innovations before taking them to the next level globally.

The Conference Board notes countries with the highest overall scores have developed successful national strategies for innovation, giving them global leadership in one or more areas. For example:

• Switzerland, the top-ranked country, is a leader in the pharmaceuticals industry.

• Ireland is the host of innovative information technology companies, and is a leader in high and medium-high technology manufacturing.

• The US fosters a combination of top science and engineering facilities, broad and deep capital markets and an entrepreneurial culture. It’s a leader in share of world patents and knowledge-intensive services.

Canada was leading in two highly innovative sectors—biotechnology and renewable fuels—but it has shifted to a follower position because of complex and time-consuming regulatory processes, slow technology adoption rates, and increasing tendencies for
Canadian companies to ignore Canadian markets for their new products.

Another Conference Board study, Conflicting Forces for Canadian Prosperity: Examining the Interplay Between Regulation and Innovation, shows firms currently face longer regulatory approval times in Canada than competitors in other countries. Wariness on the part of the Canadian public about biotechnology may be one reason for the reluctance to reform the regulatory environment.

To create a more hospitable environment for innovation, he said government has to commit to it over the long-term and come up with a national strategy. And the focus should not be on companies, but the opportunities.

“Don’t pick winners, pick the races,” he said, using an Olympian metaphor. “Create the opportunities for those who want to compete to win gold.”
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