Canada continues to trail other countries in innovation performance

www.conferenceboard.ca

OTTAWA, Feb. 2 /CNW Telbec/ - Canada continues to be a "D" performer on innovation in the Conference Board of Canada's latest How Canada Performs (http://www.conferenceboard.ca/HCP/Details/Innovation.aspx) report card, ranking in 14th place among 17 peer countries.

On the 12 indicators used to measure innovation performance, Canada gets one "B", two "C"s and nine "D"s. Canada's sole "B" is on the number of scientific articles published per one million population.

Canada ranks second to last on the new indicator - the number of international trademarks filed per million population - a measure of services sector innovations and non-technological innovations. Ten of our peer countries had at least twice Canada's share of trademarks by population.

"Canada is well-supplied with educational institutions and carries out scientific research that is well-respected around the world," said Gilles Rheaume, Vice-President, Public Policy. "But, with a few exceptions, Canada does not successfully commercialize its scientific and technological discoveries into world leading-products and services. Canadian companies are rarely at the leading edge of new technology and find themselves a step behind the leaders."

Countries with the highest overall scores have developed successful national strategies for innovation, giving them global leadership in one or more areas. For example:

    
    -   Switzerland, the top-ranked country, is a leader in the
        pharmaceuticals industry.
    -   Ireland is the host of innovative information technology companies,
        and is a leader in high and medium-high technology manufacturing.
    -   The United States fosters a combination of top science and
        engineering facilities, broad and deep capital markets, and an
        entrepreneurial culture. It is a leader in share of world patents and
        knowledge-intensive services.
    

In two highly innovative sectors - biotechnology and renewable fuels -Canada has tried to gain a global market share. A separate Conference Board of Canada report, also released today, examines the tensions between regulation and innovation.

Canadian firms were considered to be early leaders in biotechnology, but Canada has since fallen behind in the field. The reasons for the shift from leader to follower position include complex and time-consuming regulatory processes, slow technology adoption rates, and increasing tendencies for Canadian companies to ignore Canadian markets for their new products. The study finds that firms currently face longer regulatory approval times in Canada than competitors in other countries. Wariness on the part of the Canadian public about biotechnology may be one reason for the reluctance to reform the regulatory environment.

Two suggestions to adjust the regulatory system for biotechnology are:

    
    -   Harmonize, at least partially, Canadian regulations with those of
        other jurisdictions;
    -   Streamline the process of moving new, commercialized products through
        regulations to market;
    

"The Canadian regulatory system surrounding biotechnology is arguably too cautious, and a better balance needs to be found between protection of the public and support for commercialization," said Rhéaume.

The biofuels industry is a relative success story with respect to the interplay between innovation and regulation. Canada is increasing its reliance on renewable transportation fuels and is conducting leading-edge research and technology demonstration for the next generation of biofuels. Additional steps that might improve efficiency and reduce the regulatory burden for the industry would include:

    
    -   Re-examining renewable fuel standards regularly;
    -   Harmonizing, or, at least undertaking mutual recognition, of
        standards between provinces and between the federal and provincial
        governments; and
    -   Resolving conflicting policies between supporting biofuels and
        imposing stringent regulatory requirements.
    

The report, Conflicting Forces for Canadian Prosperity: Examining the Interplay Between Regulation and Innovation, is published under the banner of the CanCompete project, a three-year Conference Board program of research and dialogue is designed to help leading decision makers advance Canada on a path of national competitiveness.

For further information: Brent Dowdall, Media Relations, Tel.: [phone] ext. 448, E-mail: [e-mail]