Global Rankings Tell Worrisome Tale about State Of Canadian Innovation

GlobalRankings Tell Worrisome Tale about State Of Canadian Innovation

GlobalRankings Tell Worrisome Tale about State Of Canadian Innovation

Althoughthe Canadian government has strategic plans to support innovation andentrepreneurship through supporting the private sector, the effortsare restrained and ineffective towards producing the appropriateresults capable of sustaining Canada’s competitiveness amongdeveloped countries. In comparison to other G7 countries’economies, for instance, Canada has the lowest export tendencies. Thecountry has also the lowest rate of investment in trendingtechnologies. Even with all the relevant and appropriate resourcesthat other peer countries with competing economies posses, Canadafails to provide the innovators with the conducive atmosphere toflourish and thrive. This paper therefore, seeks to support theauthor’s argument of an inefficient strategic plan to establish andmaintain reliable innovation ecosystems.


Canadiantax policies stipulate the research and development tax credits asthe only method of support for the private sector. In comparison tothe United States, where a balance between direct taxes versusindirect tax incentives has led to a thriving industry, Canada lacksthe policies to allow the advancement of the popular transformativetechnologies. The few world-class business innovators originatingfrom Canada had the minimal opportunity and survived the hardestrules to emerge successful (Berry, 2001).

Thepolicies based on the traditional low-risk strategy where theCanadian government seeks to attain the lowest cost possible andlowest-risk do not support innovation and entrepreneurship foramateurs in Small and Medium-sized enterprises (SMEs). Consequently,the policies discourage prospective Canadian businesspersons frompursuing their ideas in the country completely affecting homegrowninnovations extensively. Again, the United States and other G7countries established Government procurement programs that attractand encourage the new innovative products and services. This strategyutilizes a competitive basis to allow for achievement and improvementof the best quality possible (Herman and Williams, 2013).


Denver(2014) highlights the fact that the gap between the leading firmswith established products and the Small and Medium-sized enterprisesis not only large but also static. Over the years, the traditionalleading companies have maintained their dominance without the roomfor competition. As a result, there exists no room for an improvementin quality of products that arises from competition. Moreover, theSMEs do not match their foreign peers since they lack the ability toexport and to compete favorably with their foreign counterparts. Theauthor shows that the lack of competition and exposure limits theimprovement in quality and ultimately the innovative andentrepreneurial skills.

Lackof competition

Cruz-Cunhaand Varajao (2011) explain that the traditional incentives that grantthe best performer the rights and leeway to lead markets are popularamong most of the sectors in Canada. Consequently, there is a commonlack of pressure to the leading firms to improve the quality of theirinitial products. Ultimately, this lack of competitive pressurereduces the need for innovation and creates a trend of disinterest inentrepreneurship.

Accordingto Hanington (2015), most striking is the fact that Canada has allthe available requirements for establishing an innovative ecosystem.They include world-class research universities, talentedindividuals, high-risk capital and critical mass, funds, local marketreach, global scalability and output performance. However, thecountry still fails to nurture and encourage the best standards inentrepreneurship. Unlike other G7 countries, it fails to transformthe resources into a meaningful and appropriate business atmosphereto create employment and income for young entrepreneurs especially inthe technologies sector.


Berry,A. (2001). LaborMarket Policies in Canada and Latin America: Challenges of the NewMillennium.Boston, MA: Springer US.

Cruz-Cunha,M. M., &amp Varajao, J. (2011). E-businessissues, challenges and opportunities for SMEs: Drivingcompetitiveness.Hershey: Business Science Reference.

DanHerman and Anthony D. Williams (2013) DrivingCanadian Growth and Innovation:Five Challenges Holding Back Small and Medium-Sized Enterprises inCanada. Journal for the Cener for Digital entrepreneurship andEconomic Performance

PitaDenver (2014) EconomicResearch: Current Analyses.Journal of the Roval Bank of Canada

TerryHanington (2015) Challengesfaced by Canadian SMEs competing Globally.Retrieved from on 4thNovember 2015