Indigenous groups worry Alberta’s $1B fund may widen gap between rich and poor
CALGARY The inspiration for Alberta’s new $1-billion fund for Indigenous business investments came from the successes of real-world First Nations business ventures, but some of those Indigenous groups are warning the provincial government to look closely at the details in their plan to ensure widespread participation in the initiative.
The intent of the recently announced Alberta Indigenous Opportunities Corp., a $1-billion fund from the province for Indigenous business investments, is “so good” but the law creating the fund needs to be more focused and some details clarified, said Paul Poscente, CEO and chair of Backwoods Energy Services, an oilfield services firm owned by the Alexis Nakota Sioux Nation west of Edmonton.
“One of the biggest constraints in Indigenous business is access to capital and I think the intent of the fund is to address this, but I think they need to be very careful that they’re not going to actually create a wider gap,” said Poscente said, adding that there are a handful of wealthy First Nations communities in the province that will have the business acumen to access the funds.
“Those few communities that have real business teams and have real capacity to access this corporation, it’s going to be their bank, and the gap between those and the have-nots are actually going to get wider,” Poscente said.
He noted the Alexis Nation, which purchased Backwoods in 2015, is among the First Nations in the province with business teams and expertise in place to leverage the fund. “We’re going to be knocking on their door (the fund’s) every day,” he said, but added that he wanted to see other First Nations groups be successful as well.
He also said the province needs to be careful that it’s not directly helping First Nations analyze or vet potential investments because that could create a liability, potentially, by recommending business ventures that aren’t successful.
Alberta is home to a range of successful Indigenous businesses, including the Fort McKay Group of Companies, owned by the Fort McKay First Nation and services the oilsands, and non-energy-related businesses such as Peace Hills Insurance, owned by the Samson Cree Nation in central Alberta.
The provincial government is aware that some First Nations and Métis communities have less capacity to either pitch or analyze potential business ventures than others, and the province is creating a separate $6-million fund for “capacity building” for those smaller Indigenous communities, Alberta Indigenous Relations Minister Rick Wilson said in an interview.
Wilson said the goal of the fund announced earlier this month is to allow First Nations across the province to participate in mid- to large-sized business ventures.
“We do have other tools in the toolbox to help with small projects as well but this is for mid- to large-sized projects and energy sector projects, which could be oil and gas, could be mining, could be forestry and could be renewables projects as well,” Wilson said.