National Digital Economy Strategy Essential for Canada's International Competiveness, Report Indicates

In Growing the ICT Industry in Canada, David Wolfe and Allison Bramwell present an overview of the current state of the global Information and communications technology (ICT) industry with a predominate focus on Canada's ICT industry. A detailed discussion of the current state of the ICT industry and the impact of the recession on the sector is covered in the first section of the report. After discussing the state of both the global and Canadian industry, the report draws on recent research and industry insight into factors and strategies that are essential for developing successful ICT clusters and a national digital strategy. The report also provides a summary of national digital economy strategy from selected developed countries.

The ICT industry globally has seen consistent long-term growth since the 2001-2002 downturn according to the report. In 2007, the globe's top 250 ICT companies saw revenues of $3.8 trillion. The industry accounted for almost 8% of business value-add activities in 2008. The sectors consistent growth was fueled by investments from venture capital and a supply of highly skilled workers. While the great recession wreaked havoc on most industries, the ICT industry performed better than the economy in general. However, the sector did see employment drop due to large layoffs within the industry. The industry's ability to outperform the global markets was in part attributed to the growing interest in broadband, cloud computing, green ICT processes and smart systems. According to the report, these sectors should continue to see strong growth potential due to the embedding of ICT into all economic and social infrastructures.

A detailed analysis of the Canada's ICT industry has seen steady growth since 2002 with long-term potential to increase the country's competiveness. The country has seen an increase in outputs, exports and revenues since 2002. According to the report, Canada's commitment to public expenditures on R&D also has allowed it to thrive in this industry. The authors contend that a national digital strategy will lead to long-term economic growth and increased competitiveness. This strategy must focus on the cultivation of existing and new ICT clusters.

The report highlights several factors that contributed to the growth of the existing ICT clusters (e.g., Toronto, Ottawa, Waterloo and Calagary) in Canada. Drawing from these specific examples, recent research and industry insight they compiled a list of crucial factors necessary for cluster development and success. They include:

• The role of a lead anchor firm and organizations;
• Talent and Cluster Development;
• The Role of Research Infrastructure in ICT Clusters;
• Global/local Linkages and Knowledge Flows;
• Financing ICT Clusters; and,
• The Role of Cluster Organizations.

In their recommendations, Wolfe and Bramwell reiterate the necessity for Countries to cultivate ICT clusters through their national digital economy strategies. Countries, however, must be careful to bring together all levels of government in a focused and comprehensive cluster strategy. A successful strategy allows policymakers to allocate resources, develop focused goals and promote linkages between firms, universities and research institutions that spur market advantages. Without cultivations of these clusters, they contend Canada may not capitalize on its potential competitive advantage in ICT industries. Read the report ...