Get ready for some monkey business. According to the Chinese zodiac calendar, the Year of the Monkey doesn’t officially start until next month, but Alberta’s economy is already off and swinging among the rafters.
As we look back on 2003, Business Edge profiled both newsmakers and heartbreakers in the province’s booming business community – from bankruptcies to P3s, from shameless government boosters to homegrown biotech wonders. Our reporters and columnists cast a critical eye on Kyoto, and were sickened by the spectre of mad cow.
We probed the crisis wrought by SARS on the tourism industry and bemoaned the continuing fallout from high-profile business scandals. We laughed and gasped at scoundrels and boondoggles.
And everybody held their breath at the prospect of war.
So as we sheepishly bid farewell to the Year of the Goat (just ask Conrad Black), we take a look back at some of the headlines and bylines from across the province that swept across our pages in 2003. Let the learned economists poke through the entrails and swirl the tea leaves to discover the Next Big Thing in 2004 – for Business Edge readers, it’s time to reflect on the ghosts of business past.
January: The year kicks off with a new consumer survey that shows 76 per cent of Calgary residents giving a thumbs-up to the local economy. Edmonton’s economy is also on a roll, as local pundits estimate full employment and annual growth of three per cent each year until 2007.
On the business scene, Alberta executives say they’re more worried about the dent the Kyoto accord and higher taxes are going to put in their bottom lines than a potential U.S.-led tilt with Saddam Hussein.
Business Edge columnist Tom Keyser profiles the brains behind a shooting star by the name of Impact Blue, a Calgary-based technology, software and communications company that is leveraging itself into blue-chip client heaven. A head-spinning 12 months later, the company will be scuffing its knees in bankruptcy court.
SuperNet spins its magical fibreoptic web across Alberta as the government stretches to connect more than 400 communities, with private- sector partner Bell West and subcontractor Axia NetMedia. But the relationship turns sour, and late in the month, Bell dumps Axia as its partner in the rural build-out of the network.
And while Synsorb Biotech’s hopes for its anti-diarrhea drug fade, the company works up a new head of steam by hiring former PanCanadian CEO David Tuer to freshen its image as an oil and gas producer.
February: Coal is cleaning up its reputation in energy circles as the federal government kicks in nearly $1.7 million toward a $1-billion push to build Canada’s first “clean coal” power plant.
The oilpatch gets even better news when federal Energy Minister Herb Dhaliwal promises not to cut tax incentives for Alberta’s oilsands projects. Dhaliwal, alas, will not last the year, and announces his resignation from the federal Liberal cabinet following the coronation of prime-minister-to-be Paul Martin.
By the end of this month, war is brewing, and oil firms with a Mideast presence – including Petro-Canada, EnCana and Talisman – are weighing the benefits and risks of continuing operations there. “We’re expecting business as usual,” says Petro-Canada spokeswoman Michelle Harries.
March: March comes in like a freight train, and Business Edge is right on track with a special edition profiling Alberta’s transportation sector. A two-day Canada West Foundation conference on the issue concludes that a Calgary-Edmonton high-speed rail line must be driven by market demand, and current traffic levels don’t support such a mega-project.
Blue skies are predicted for Edmonton Airports, which has become the country’s fifth-busiest with nearly four million passengers each year.
Meanwhile, a symposium held in Calgary is putting the brakes on predictions that affordable fuel-celled cars will be available anytime soon. “It’s going to happen,” says fuel cell researcher Viola Birss. “It’s just going to take a little longer than we thought.”
The economic outlook in northern Alberta has a little extra sparkle this month when Tory MLA George VanderBurg predicts a diamond mine will be operating in the Whitecourt-Ste Anne area within the decade. And gold continues to glitter in the eyes of investment pro John Ing, who says he’s bullish on the precious metal on the eve of war.
April: There are troubled rumblings from within Alberta’s tourism industry after Canadian officials refuse to join the U.S. adventure into Iraq. “The reaction I got is: ‘Why aren’t you guys backing us?’ ” reports a worried Tourism Calgary president Joe Fardell, after returning from a vacation down south.
Alberta businesses are also on high alert for possible fallout in the relationship with Canada’s largest trading partner. Airlines are reporting a prolonged slump in the travel industry, although home-grown WestJet is managing to stay aloft with loyal passengers.
The oil and gas industry is simmering over the impending federal plan to implement the controversial Kyoto Protocol. “. . . the thought of reporting through 13 different regulators (Ottawa and each province) is just completely unappealing, inefficient, and probably wouldn’t work,” says Pierre Alvarez, president of the Canadian Association of Petroleum Producers.
Industry insiders worry that Alberta’s natural gas shipments could face trade sanctions under the accord, and fear their sector will be unfairly targeted for the burden of costs for reducing greenhouse gases.
May: There’s a hole lotta shaking goin’ on the food front, as doughnut kingpin Krispy Kreme prepares to roll into town. KK plans to open a “hot” outlet in northeast Calgary, and will follow up later this fall with a free doughnut feeding frenzy on Stephen Avenue Walk. KremeKo officials may also soon be eyeing a site in Edmonton.
On a more serious note, SARS continues to be a concern, and even the markets are quivering. Bank of Canada governor David Dodge, “who hardly ever says anything remotely interesting,” says columnist Gyle Konotopetz, raises a red flag over the issue, warning its economic impacts cannot be ignored. Merrill Lynch forecasts a SARS impact on our economy of between a half and one per cent annually for the second quarter as the number of suspected virus carriers jumps from 167 to 4,500 worldwide in a five-week period.
June: The taps are finally opened on the Athabasca Oil Sands Project as Premier Ralph Klein starts the bitumen flowing from the Muskeg River Mine north of Fort McMurray to the Scotford Upgrader just outside Fort Saskatchewan. Once operating at full capacity, the project will be able to provide for 10 per cent of Canada’s energy needs.
But pity poor old Paramount. The Calgary-based energy trust is threatening a class-action suit against the provincial government after an Energy and Utilities Board proposal to shut in more than 900 wells in the Athabasca oilsands region to help preserve the geological reservoir pressure required to extract the tar-like bitumen, which has greater energy value than the gas. By mid-fall, the province will agree to pony up a deferred royalty package to compensate producers such as Paramount.
Alberta’s $15-billion beef business continues to struggle as the U.S. continues to guard its borders against the scourge of BSE. Laid-off beef workers across the province are starting to appear at food banks, even while the provincial and federal governments work to provide relief grants and breaks on qualifying for Employment Insurance. “I think it’s very, very important that we try and keep as many employees as we can somehow attached to the industry,” says Alberta Human Resources and Employment Minister Clint Dunford.
July/August: The lazy days of summer may have arrived, but there’s no rest for the real estate industry. While the red-hot housing market is cooling off a bit, interest rates are still wooing new buyers and both Calgary and Edmonton report sale prices are on the rise.
In Calgary, the East Victoria district is preparing for a long-awaited facelift, as city officials join forces with industry and local residents in a planning process to rejuvenate the area.
In Strathcona County east of Sherwood Park, Habitat Acres is starting to take shape as a new residential development with an emphasis on nature – each individual buying a lot must sign a perpetual conservation agreement preserving nearby meadowlands as wildlife habitat.
It’s also Stampede time in Calgary, but the agricultural aspect of the exhibition is muted over the lingering effects of the single detected case of mad cow. The International Beef Industry Congress holds a meeting in Calgary, and concerned cattlemen hear that aspects of the national farm food-safety program may become mandatory. By early July, more than 2,700 cattle have been slaughtered across three provinces, but the disease has still not re-emerged. It will take until fall before the U.S. starts to make moves to open its border to certain boneless cuts of young Canadian beef.
September: Cell-Loc continues its slide into obscurity that began more than two years ago when it first announced major restructuring moves. The Calgary-based firm, once a darling on the stock market for its cell-location tracking technology, cuts half of its staff this month. By the end of the year, Cell-Loc will re-invent itself as an oil and gas company backed by an investment group, announcing it will spin off technology assets into a separate company and use the shell as an energy play.
Business Edge trumps its rivals in the daily press (again) with an in-depth interview with incoming Shell Canada president and CEO Linda Cook. Cook tells us that she doesn’t expect to veer off the course set by outgoing chief Tim Faithfull. She describes the challenge of balancing her personal and business lives as “harder than I ever imagined,” but doesn’t rule out a run at the top spot at parent company Royal Dutch/Shell.
October: There’s growing turbulence over Edmonton’s city centre airport, and fearing its forecast closure, several mayors from northern Alberta towns offer to take it over and run it as a commuter facility. The air pressure continues to build until late November, when the Edmonton Regional Airports Authority postpones a controversial plan to halt all regularly scheduled flights into the airport for further consultation.
Insurance rates are also in the news this month, and as the Alberta government prepares to rewrite the rules of auto premiums, the business community steps forward to demand fair consideration through a review of business insurance. “Many people have contacted our association about the huge rate increases in property insurance and the take-it-or-leave-it attitude of insurers,” notes Bruce Cran, national secretary of the Consumers Association of Canada. But the Alberta government says a review is not in the cards.
November: Worries about electricity deregulation are temporarily placed on the back burner when the province decides to review the move to implement the next phase of the controversial policy by January 1. Small and medium businesses in particular had been concerned about the impending loss of the Regulated Rate Option, which would mean forcing them into a less-than-competitive retail market.
And the Stampede City’s economic plan is back in the saddle this month as rookie Calgary Economic Development president Bruce Graham unveils his strategy to keep the city’s business pistons firing. His mantra? Energy, accountability, focus. The city-funded agency has seen some troubled times, so the message is well received by the business community.
December: New privacy legislation is in the wind this month, but Alberta businesses say they’re still in the dark about what it all will mean when new laws come into play at the end of the month. Both the federal and provincial governments have their own legislation requiring protection for personal information held by the private sector. “A lot of this is good records management,” says Tim Chander of the provincial Office of the Information and Privacy Commissioner. “You don’t need to spend thousands of dollars on fancy programs.” Just lock up those filing cabinets, people.
That’s the way we saw it in 2003. From all of us at Business Edge, have a peaceful Christmas and a prosperous 2004.
