Canada Releases New National Science and Technology Strategy

As the development of a nation’s science and technology capacity becomes a critical component for economies around the globe, it is becoming even more critical for countries to implement strategies that will enable future competitiveness. This is particularly true for the world’s leading economies, which is why, for example, the European Commission increased the resources invested toward research and innovation (see May 2, 2005 and Oct. 22, 2006 issues of the Digest.)

With the recent release of a national science and technology strategy, Canada becomes the latest developed nation to outline specific steps to maintain its competitive position. Mobilizing Science and Technology to Canada’s Advantage centers around themes to encourage more private R&D and concentrates federal research support in the areas of natural resources, the environment, health and information technology. The strategy follows up on the government’s November 2006 release of Advantage Canada, a report that recognizes the competitive strengths of the Canadian people and infrastructure and emphasizes the necessity to do more to create innovation and spur improvement.

The emphasis on private R&D investment is supported by various statistics illustrating Canada’s current position. In 2005, the strategy observes, only 54 percent of the $27 billion of the R&D performed in Canada in 2005 originated from the private sector (note: all figures are in Canadian dollars). Comparatively, this is well below the average of countries in the Organisation for Economic Cooperation and Development (OECD), where private sector R&D averages 68 percent of total expenditures. Among the G7 nations, Canada has the highest ratio of public R&D investment to national gross domestic product (GDP). But when the private sector is factored in, total R&D spending is only 2 percent of GDP, less than most of the G7 economies.

>From a workforce perspective, Canada is the OECD country with the highest share of its population with an undergraduate degree. However, it is ranked 20th in natural science and engineering degrees, as a share of total degrees, and 17th in the number of people in science and technology occupations, as a share of total employment. The report concludes that Canada’s private sector "does not provide enough incentives for students to strive for advanced S&T and business management skills."

Policy recommendations are organized into three categories: a collection of steps to ameliorate Canada’s entrepreneurial advantage, its knowledge advantage, and its people advantage. Some of the highlights of these recommendations include:

Entrepreneurial Advantage

* Provide $350 million over three years to establish eight large-scale centers of research and commercialization in distinct priority areas.
* Provide $48 million over five years for a program to support more college-industry partnerships.
* Establish the lowest tax rate on new investments by businesses among the G7 nations.
* Adapt the Canada-U.S. Tax Treaty to allow Canadian entrepreneurs improved access to U.S. venture capital.

Knowledge Advantage

* Invest in priority research with $85 million per year in new research ventures, allocating $500 million for developing next-generation renewable fuels, $100 million for Genome Canada, and $30 million for spinal cord research.
* Provide $510 million to build state-of-the-art research infrastructure at higher education institutions before 2010.
* Provide $120 million to maintain and further develop research broadband networks.

People Advantage

* Beginning in 2008-09, invest an additional $800 million in the Canadian postsecondary education system, increasing 3 percent per year thereafter.
* Support up to 1,000 interns per year in government positions through a new industrial R&D internship program.
* Provide $35 million the next two years, then $27 million afterwards, for the government to support an additional 1,000 graduate students each year.

Mobilizing Science and Technology to Canada’s Advantage is available at:
http://ic.gc.ca/cmb/welcomeic.nsf/vRTF/PublicationST/$file/S&Tstrategy.pdf

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