BV Outlook 2012
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The story of 2011 was the huge win of the Irving ShipbuildingInc. federal contract, but – while this will have an enormous impact on business in 2012 – the real economic impact will not be felt until 2013 and beyond. 2012 should be looked at as a training year as we get ready for the big game. For local business this is a one or two year heads up that if you want to be part of this new era of prosperity you need to:
• figure out what’s the best roleyou will be able to play;
• determine how that role fits intothe larger value chain; and
• develop and execute your planto become one of the world-class suppliers to a project that demandsnot only the highest quality, butat globally competitive prices.
When you’re building ships that sail under the conditions and situations the Royal Canadian Navy and the Canadian Coast Guard perform in, there’s no allowance for local if you aren’t the best. But direct participation in shipbuilding really is just the beginning.
Shipbuilding at this calibre is part of the broader ocean technology cluster that has, in the past few years, made itself known in Atlantic Canada. With this contract,it has become the most exciting sector of our economy.If Nova Scotia has a chance to escape its recent past history of competing on the basis of low wage costs and propping up declining industries to save jobs, then it will be via this sector leading a return to our glory days of utilizing its sustainable competitive advantage derived from the sea that surrounds us. The beauty of economic growth is that it’s never restricted to the core drivers of that growth, but creates widespread prosperity due to the multiplier effect. The initial increase in GDP may come from a shipbuilding contract, but it could be multiplied by a vibrant financial services sector or an exciting new business growing from the commercialization of academic and government sponsored research and development.Wealth gets created, wealth gets spent and taxes get collected. We need to keep our expectations in check with regards to immediate results in 2012, but there may never be a more important year in determining just how much of the economic growth stays in this province.