Editorial - 30-7

From telecom to clean tech, Canada can rightfully boast of excellent research that fuels globally competitive innovation. The question is, who will ultimately exploit and benefit from that research and should it matter whether the innovators are Canadian or foreign-based?

In the case of telecom, Canada's top-notch researchers, engineers and technicians are increasingly working for foreign-owned firms, from Ciena and Cisco to Huawei and Ericsson. The decline or demise of global players like Blackberry and Nortel Networks has left the field open for multinationals to expand Canadian operations to take advantage of top-flight talent. Huawei, for example, has discovered amazing expertise in Ontario and is rapidly expanding in Ottawa, Markham and Waterloo (see lead story).

The R&D-intensive clean tech sector is also attracting interest from foreign companies and financiers lured by valuable intellectual property and talent.

There's nothing wrong with foreign-owned operations. They hire people and pay taxes like domestic companies, although decision making originates elsewhere and profits move outside of Canada. A best-case scenario would be for Canada to enjoy a healthy mix of foreign and domestic firms that grow and complete at the global level.

But that requires a different mix of policies and programs that support scaling up and ensure adequate financing that doesn't make moving to foreign jurisdictions a foregone conclusion. The forthcoming Innovation Agenda can't come a moment too soon.