A small, non-profit organization says Atlantic Canada could create thousands of jobs and rejuvenate its smaller communities by replacing some of the goods and services those communities import with locally produced ones.
The Nova-Scotia-based Centre for Local Prosperity released a 56-page study last week showing that in 2012, Atlantic Canada imported $11 billion more in goods and services than it exported to other places. New Brunswick’s trade deficit was about $1.4 billion while Nova Scotia’s was $4.8 billion.
“One of the analogies we use is small communities tend to be like leaky buckets,” the Centre’s Executive Director Robert Cervelli said last week in Shelburne, N.S. during a town hall presentation that has been posted online.
He added that money leaks out of communities when they buy imported goods and services instead of producing their own.
Cervelli showed a slide of a typical fast-food strip.
“We’ve all seen strips like this,” he said, “you’ve driven down them, all the big brand names, you know what they look like.”
He added that smaller communities have been quietly co-opted by international businesses like those on commercial strips as well as banks, insurance companies and big retail stores that are highly efficient at funnelling consumer dollars from local economies into their headquarters in faraway cities.
Cervelli said a statistical analysis conducted as part of the study showed that four out of every ten dollars that circulate in Atlantic Canada leak out of local economies this way.
The study found that if people shifted 10 per cent of their spending from imports to local goods and services, the four Atlantic provinces would gain 43,000 jobs, $2.6 billion in wages and $219 million in new tax revenue.
Aside from statistical analysis, the study on import replacement (IR) is also based on a series of eight focus group discussions conducted with local residents as well as business and community leaders in four communities: Miramichi, N.B., Shelburne, N.S., Souris, P.E.I. and the Burin Peninsula in Newfoundland.
Karen Foster, a professor at Dalhousie who specializes in rural economic development, said the focus group sessions showed that people understand the need to produce and buy more local goods and services.
“People were not at all surprised by this idea of import replacement,” she said during the Shelburne town hall meeting. “They wanted to plug the leaks in their community…people understand the need to plug the leaky bucket.”
Foster said the one of the main barriers people in rural communities face when they try to start their own businesses is that government regulations are biased against small, locally owned outfits in favour of bigger businesses such as the chains that can be seen on commercial strips.
She also mentioned that small rural businesses can have trouble attracting enough workers and some, such as tourist operators, have difficulty getting insurance.
Meantime, Cervelli said imported food and energy are the easiest imports to replace.
He pointed, for example, to ACFOR, a small company in Cocagne, N.B. that uses selective harvesting to produce wood chips for heating public buildings while restoring the Acadian forest. He also mentioned New Brunswick’s Farm to School project in which school cafeterias serve locally produced food.
The study outlines a series of steps local communities can take, such as setting up a broad-based group to work on finding ways to produce more local goods and services.
It says municipal and provincial governments can also help by buying more local goods and services, providing incentives for community investments and changing regulations and zoning restrictions that inhibit small businesses.
Gregory Heming, a municipal councillor in Nova Scotia’s Annapolis County and a founder of the Centre for Local Prosperity, told the town hall meeting in Shelburne that his municipality has set certain goals including producing 80 per cent of its own energy and food by the year 2050.
Heming, who holds a PhD in ecological studies, says the prevailing wisdom of economic experts is that businesses have to learn to compete on global markets. But, he adds, it makes sense for smaller communities to become more self-sufficient instead, generating local wealth instead of importing goods and services from afar.
“The more you can produce locally, the better off you are,” he said. “This study and this documentation gives me great hope in the power and strength of local people and local government.”
To view a six-page summary of the study on import replacement, click here.
To read the full study, click here.
To watch the town hall presentation last week in Shelburne, click here.
Note: The Centre for Local Prosperity says it plans to hold a series of regional meetings and workshops in the coming year to discuss its study on import replacement.