Hub ‘a real centre of excellence’: Natural Resources Minister Anthony Reinhart April 4, 2012 Communitech The Communitech Hub is “a real centre of excellence” that exemplifies Canada’s effort to lead the world in technological innovation, the federal Minister of Natural Resources said today. Joe Oliver made his remarks during a visit to Communitech’s 44,000-square-foot facility in downtown Kitchener, where more than 50 early-stage companies share incubation space with large technology firms and academic partners. “Kitchener-Waterloo has secured its place as a hotbed of innovation,” Minister Oliver told a crowd of Hub residents and guests. “The network you’ve created is helping to ensure that some of tomorrow’s greatest breakthroughs are made in Canada.” Minister Oliver is on a tour of cities to talk about last week’s federal budget, which included measures to boost innovation, entrepreneurship and research, and streamline incentive programs for innovative companies. “Canada continues to lag peer nations in terms of overall innovation performance, including with regard to private-sector investments in R and D and the commercialization of research, and to products and processes that create high-value jobs and economic growth,” he said. “Our government is taking steps to fix this problem.” Communitech CEO Iain Klugman applauded the government’s initiatives to increase companies’ access to investment capital, and to improve the Industrial Research Assistance Program (IRAP) and Scientific Research and Experimental Development (SR&ED) program. “Time and again, technology companies tell us that their key challenges are access to talent and access to capital; that’s why we were encouraged to see the emphasis placed on access-to-capital measures in last week’s federal budget,” Klugman said. “Programs like IRAP and SR&ED are critical investments to the growth and success of technology companies,” he added. After a tour of the Communitech Hub, Minister Oliver sat down for a brief interview in which he reiterated his praise for the Waterloo Region approach to commercializing innovation. Q – What are your impressions of the Communitech Hub and our initiatives here? A – I think it’s a very exciting place. People with a lot of ideas and transformative technologies are getting the benefit of an environment where they can connect with other people who are going through the same process. As well, they can get exposed to some basic services that they’re all going to need, that they might not have had any exposure to before. It spans quite an age range, but there are a lot of them who are quite young and they haven’t had exposure to marketing, necessarily; to the legal requirements, regulatory requirements, advertising. So, I think it’s got to be a tremendously helpful environment to incubate ideas that could really be tremendously successful in the marketplace. Also, this is a real centre of excellence here, and I think it’s important for the country to have them spread around. We don’t want everything to be focused in the big cities, and this area, Kitchener-Waterloo, has already proven itself. It’s great that we’re able to help, and I think this is precisely what we should be doing. Ours is not to pick winners or losers, but we can play a role in creating the conditions that permit creativity to result in commercial reality. That’s great for the country, it’s good for employment, it’s good for economic growth and it keeps some of the best of the best here in Canada. Q – What does the new federal budget say about the government’s commitment to fostering innovation in Canada? A – I talked a bit in my speech about the dollars that we’re putting into science, technology, innovation, supporting venture capital formation. So, it’s sort of consistent with that approach of jobs and growth. We’re taking a whole-of-government approach to this. My focus is on natural resources, so it’s a little bit removed, except that natural resources are, at the end of the day, a technological industry. It’s only going to grow and succeed and be competitive with continued technological innovation. There are jobs here in Ontario that are critically dependent upon development of the oil sands and other oil-and-gas and mining sectors. I don’t know how many of these smaller firms here are involved in that, but there are enormous opportunities, because when you look at the largest single industrial project in the world (the oil sands), it’s clear that there’s a huge potential for innovation in terms of reducing the carbon footprint, in terms of extracting more of the resources from the land, in terms of making it more efficient and economically viable. That kind of innovation is constant; the use of less water or solvents for extractive processes and so on. So from my focus, I see that opportunity here as well. Q – How important is pure innovation to Canada’s economic prosperity going forward? A – I think it’s crucial, because without it, our manufacturing sector is not going to do well. We know that manufacturing employment has declined steadily for the last 30 or so years, and the overriding reason is the difficulty in competing with lower-cost emerging markets like China, India, Korea and so on. What is the hope then for manufacturing in Canada? It has to be focused on high-quality, technological innovation related to businesses that we’re involved in or businesses where there is tremendous export potential, because we don’t have a market big enough in this country, generally. If we’ve got to keep our competitive advantage, then technology’s the way to do it; otherwise we will be hewers of wood and drawers of water. Q – If someone asks you later today what you learned during your visit to Waterloo Region and Communitech, what will you tell them? A – What I’ll tell them is, there are a lot of very smart people here that not everybody in Toronto on Bay Street knows about, and they should come here and check it out, because there are going to be some breakthroughs and they should get in on the act.