Centre for Local Prosperity releases report
‘Just the beginning of the conversation’
A two-year study conducted by the Centre for Local Prosperity already has people talking.
The centre produces hard data analysis on the value of import replacement as “a crucial economic driver for small, rural and local communities looking for a new and different economic future.”
About 20 people attended the release of the report – Import Replacement: Local Prosperity for Rural Atlantic Canada – Feb. 26 in Shelburne, one of four communities in Atlantic Canada focused on for the regional study. Miramichi, N.B.; Souris, P.E.I. and Burin Peninsula, NFLD were the other three.
“This is just the beginning of the conversation,” said Gregory Heming, senior advisor for the Centre for Local Prosperity, an Annapolis County municipal councillor and one of the study’s authors. He urged those present to “take this information back to the community, municipal council and start to dig deeper… this study and document gives me great hope in the power and strength of local people and local government.”
Looking at the balance of trade, with exporting on one side and importing on the other side, “if that goes out of balance, if you have to import more than you export you are in a negative trade balance,” said Robert Cervelli, executive director of the Centre for Local Prosperity. “Trade deficit means the money is going out faster than it’s coming in so you’re losing wealth over time.”
According to the 56- page study, overall Atlantic Canada has a trade deficit of 40 per cent; four out of every 10 dollars spent leaves the regional economy. In Nova Scotia, the trade deficit is 35 per cent. Cervelli said the total demand of what has to be purchased in Nova Scotia annually is $45 billion. Almost $30 billion is produced annually, leaving just under $16 billion to be imported to meet the overall need.
“If we reduced that leakage by 10 per cent it would create 15,000 new jobs in Nova Scotia,” said People listen and take note of what is being said during the release of the report, Import Replacement: Local Prosperity for Rural Atlantic Canada, in Shelburne on Feb. 26. Karen Foster, assistant professor in the Department of Sociology and Social Anthropology at Dalhousie University, was the principal investigator for the import replacement study. Cervelli. “With just a 10 per cent shift, it would create $877 million in additional labour income. It would produce $1.4 million in additional value added into the economy, $67 million in direct business taxes for government… (and) “would fill 38 per cent” of the unemployment demand.
Breaking it down to Shelburne County, which has 1.5 per cent of Nova Scotia’s population, a 10 per cent shift to procuring locally produced goods and services would mean 218 additional jobs, said Cervelli.
“What tends to be the case in small communities is they tend to have an even worse trade balance,” said Cervelli. “There’s a lot of money flowing out because a lot of things have to be imported… The community has the ability to produce things, anything. It could be goods and services, professional services, Boxing Rock Beer, lobster, a factory, it doesn’t matter as long as it’s producing. If you replace imports with something made locally you’re keeping the money in the community.”
Principal investigator for the import replacement study, Dr. Karen Foster, assistant professor in the Department of Sociology and Social Anthropology at Dalhousie University, said the study findings revealed that, overall, import replacement “already seemed like a no- brainer” to many focus group participants, leading to the question why aren’t more people doing it.
“Rural places are already more entrepreneurial,” Foster said. “They have higher rates of selfemployment. People are taking risks, starting businesses, trying to meet rural demand,” she said. “It’s more about the structural conditions they are working Robert Cervelli, executive director of the Centre for Local Prosperity, makes a point during the release of the report Import Replacement: Local Prosperity for Rural Atlantic Canada Feb. 26 in Shelburne, one of four communities in Atlantic Canada focused on for the regional study. with. We found some consistent problems; difficult to attract and find staff, prohibitive regulations and red tape is one of the biggest issues that varies by industry and community, also issues with insurance and liability costs.
“What came out of the aggregate of all that is a lot of policies that were frustrating local communities were biased against small, locally owned businesses in favour of bigger businesses,” she added.
“Another issue is what I term shrinking development space. Big companies that are meeting the demand locally so it’s really hard in a small community to break into that with a small local product so the space for economic development is shrinking because the small business is being edged out by the bigger guys.”
She said one final interesting point gleaned during the study were the rural ways of life.
“Some are stereotypical but they exist in the stories the rural communities tell about themselves,” she said. “People understand when you are living in a rural community the need for diversification in your own livelihoods and in the community itself. Some of best examples of business we saw had diversification built right into their business plans. Communities are ready for this.”
According to the report, there are already many examples of efforts at the community and regional levels to shift to meeting local needs with local production.
Cervelli said one thing they noticed is that rural communities are “ahead of the curve in a lot of the assets that are available to use. The natural environment is an enormous asset in rural communities for a tourism base, as a natural resource base, farming, fishing, you don’t have that in an urban setting.”
Cervelli urged people to sit down and start having conversations.
“If people aren’t talking to each other nothing happens,” he said, offering to buy the coffee if a community import replacement group starts in the area. “The expectation that economic development must be done primarily by governments is obsolete.
It can begin by a group of engaged residents.”
He cited the success of the Live Well Challenge. “One guy started it. It was a good idea,” so far raising an estimated $900,000 for charities.
“It doesn’t take many people to get something going so it’s really having those conversations that’s important.”
Taking stock of community assets such as residents’ skills, vacant buildings, volunteer organizations, local natural resources, underutilized or arable lands, community meeting places, government programs, inventorying existing businesses, entrepreneurial skills and mentors, and local investment potential and other features of the community, is another key recommendation.
“Start with the low-hanging fruit,” said Cervelli.
“Communities can target just one key unmet local need, even if it seems isolated, knowing that it will have multiplier effects and attract new momentum. Once there is an early success, build on it through public awareness.”
Cervelli said there are at least 10 studies in North America that show a locally owned business creates 2.5 more jobs than a non-locally owned business.
It’s not just the jobs in the business that are created. A local business will also hire support services such as an accountant or crafts people, for example, he said.
“Import replacement can be a crucial economic driver for small, rural and local communities looking for a new and different economic future,” the study says. “A community’s willingness to be resourceful in providing what it needs opens up enormous longterm community benefits. The results of this project show that everything we need is right here. The rest is up to us.”
The Centre for Local Prosperity is a registered non-profit organization networking with leading voices in Atlantic Canada and internationally in order to help guide rural communities and organizations in finding ways to implement new economic models that address climate change, declining population and global supply disruption. The full report is available online at www.centreforlocalprosperity.ca