May 18, 2009
The commodity boom and the rise in energy and agricultural prices are creating a new surge of growth and optimism in the interior resource regions of North America.
Consisting of Saskatchewan, Manitoba, Northwestern Ontario, Minnesota and the Dakotas, much of this region – termed Heartlandia - continues to experience substantial economic growth, even in the wake of the recent global economic downturn. Its success is the result of a diversified economy rooted in economic fundamentals such as sound lending practices, food and resource processing, transportation and new knowledge-intensive economic activities.
Moreover, the economic activity in this central North American region is increasingly integrated, with much of the trade consisting of inputs into each other’s production chains. In fact, Canada is the three US states most important destination for their exports. In 2008, Canada imported 29% of Minnesota’s exports, 51% from North Dakota and 34% from South Dakota. Meanwhile, Saskatchewan, Manitoba, and Northwestern Ontario are even more dependent on the American market. In 2006, about 77% of Manitoba’s and two-thirds of Saskatchewan’s exports went to the United States. Northwestern Ontario is even more dependent on the United States, with over 90% of its exports destined for that market.
The next step is to translate this new growth into long-term success, which will require more cooperation on a regional cross-border level. Talks toward a broader vision of regional cooperation were held in October 2008 at Grand Forks during the USA/Canada Economic Summit, in which several presentations on the economy of the interior North American heartland region were presented. It is now time for this region to move toward a more formal process of cross-border cooperation akin to what has been underway in the Pacific Northwest for almost 20 years. Saskatchewan, which recently joined the Pacific Northwest Economic Region (PNWER), could both act and benefit as a link between PNWER and Heartlandia.
Heartlandia covers 2.4 million square kilometres with a population of nearly nine million people and a GDP, in US dollars, of about $405B. The region contains agricultural production activities, food processing, forestry, petroleum, potash, uranium, coal, mineral and hydroelectric resources as well as substantial manufacturing, research and service capacity.
In terms of employment, Saskatchewan, Manitoba and Northwestern Ontario are more resource intensive compared to their American counterparts (although Manitoba also has a strong manufacturing sector) while both Minnesota and North Dakota lean toward more manufacturing. at least as compared to the rest of Heartlandia. Heartlandia also contains vital road, rail and airport hubs, three ocean-going ports – Churchill, Duluth and Thunder Bay - and the Mississippi, which winds its way down to the Gulf of Mexico. The region is strategically located at the hub of an array of transportation corridors and routes that includes the Asia-Pacific Gateway, the North American Super Corridor Coalition and the Great-Lakes St. Lawrence Seaway.
We have only to look to the PNWER for a template on which to begin organizing Heartlandia’s activities as an economic region. The PNWER has been acting as a voice for the provinces, territories and states of the Pacific Northwest in the region and their population of 20 million for 18 years now. The highlight is their annual meeting.
PNWER is governed by a bi-national executive committee of 19 executive members, consisting of a President, four Vice-Presidents, an immediate past-president and supplemented by past presidents, politicians and several private sector members. This large executive ensures representation from all of the constituent provinces, territories and states. As well, an Executive Director maintains the administrative operations of the organization and supervises a staff of eight to provide the manpower to drive initiatives and activities.
A review of its staff’s responsibilities provides us with a quick overview of its activities, which Heartlandia should emulate. The PNWER staff - which includes an Energy Project Director, A Tourism Program Manager, a Homeland Security Coordinator, An Innovation Network and Workforce Development Program Coordinator, and the Director of A Centre for Regional Disaster Resilience - help organize and maintain a number of working groups dealing with specific regional issues: tourism, agriculture, border issues, energy, environment, forestry, health care, high tech, homeland security, invasive species, sustainable development, telecommunications, trade and economic development, transportation, water policy and workforce development. PNWER also maintains regional news feeds, trade and economic statistics and is about to begin putting together a Border Policy Institute to mobilize research on border issues.
It is time for community leaders in Heartlandia to do the same. Institutionalizing a regular set of meetings as has been done in the Pacific Northwest is a good beginning. Furthermore, developing a regional vision and set of common statistics that could be used to lobby both federal governments could also have long-term benefits, particularly when it comes to border issues that threaten its prosperity. Setting up a more formal organization, to advocate on its behalf, would also ensure that it will be able to build on its current prosperity.
Heartlandia has had a recurring economic history of boom and bust ever since the days of the fur trade. By working together, the region will be able to smooth out the economic cycle and take long-term advantage of its current prosperity.