Enhancing Canada’s AI Advantage: Insights from the Lawrence National Centre Event

By Berto Mill

I recently attended an event hosted by the Lawrence National Centre for Policy and Management titled “Enhancing Canada’s AI Advantage in a Competitive and Uncertain World.” The event provided valuable insights into the challenges and opportunities facing Canada’s artificial intelligence (AI) sector. In this article, I will share some of the key takeaways from the event and discuss how Canada can address the challenges of productivity, investment, and talent retention to secure its position as a global leader in AI.

The AI Revolution: Canada’s Opportunity to Lead

As the world enters the fourth industrial revolution, driven by advancements in AI and other emerging technologies, Canada has a unique opportunity to establish itself as a global leader in the field. With a strong foundation in AI research and a vibrant startup ecosystem, Canada is well-positioned to capitalize on the economic and social benefits of AI.

However, as highlighted by speakers at the Lawrence National Centre event, Canada must act quickly and decisively to address key challenges and maintain its competitive edge. This includes investing in research and development, fostering a supportive regulatory environment, and attracting and retaining top AI talent.

Overcoming the Productivity Challenge

A study by RBC stated that Canada is 30% less productive than the U.S. and closer to lower-income states like Alabama in terms of economic performance than tech-rich California or New York. The result: We’ve fallen from the 6th most productive economy in the organisation for Economic Co-operation and Development in 1970 to the 18th as of 2022.

To address this challenge, Canada needs to create a more favorable environment for entrepreneurs and business development. This can be achieved by implementing a more favorable tax policy that encourages entrepreneurial talent and business growth while ensuring responsible AI development that does not stifle economic prosperity.

In April 2024, Prime Minister Justin Trudeau announced a $2.4 billion package of measures to accelerate job growth in Canada’s AI sector and boost productivity by helping researchers and businesses develop and adopt AI . The key components of this AI investment package include:

• $2 billion to build computing capabilities and technological infrastructure for Canada’s AI researchers, start-ups, and scale-ups. This includes launching a new AI Compute Access Fund and developing a Canadian AI Sovereign Compute Strategy.
• $200 million to boost AI start-ups in bringing new technologies to market and accelerate AI adoption in sectors like agriculture, clean technology, healthcare, and manufacturing.
• $100 million for the NRC IRAP AI Assist Program to help small and medium-sized businesses incorporate AI and increase productivity.
• $50 million for the Sectoral Workforce Solutions Program to provide skills training for workers potentially impacted by AI disruption.
• $50 million to create a new Canadian AI Safety Institute to further the safe development and deployment of AI.
• $5.1 million to strengthen enforcement of the proposed Artificial Intelligence and Data Act to protect Canadians from potential AI risks.

This investment is crucial for Canada to maintain its competitive edge in the global AI landscape.

Navigating Policy and Regulatory Hurdles

While policy plays a crucial role in fostering a thriving AI ecosystem, it is equally important for the government to fodter an environment that allows founders to establish and grow their companies. Excessive regulations and bureaucratic hurdles can stifle innovation and discourage entrepreneurs from starting or expanding their businesses in Canada.

To address this issue, policymakers can focus on creating a more streamlined and business-friendly regulatory environment. This can involve simplifying the process of starting and operating a company, providing tax incentives for AI startups, and investing in research and development to support the growth of the AI sector.

Winning the Global Race for AI Talent

To keep AI talent in Canada, the government and private sector must work together to create compelling reasons for professionals to stay. This can include offering competitive salaries, providing funding for research and development, and fostering a vibrant and supportive AI community. Additionally, attracting international AI talent to Canada can help bolster the country’s AI workforce and bring fresh perspectives and expertise to the sector.

Actionable Insights for Business Leaders

Business leaders in Canada’s AI sector can take several actions to capitalize on the opportunities and navigate the challenges discussed at the Lawrence National Centre event:

1. Invest in AI research and development: Allocate resources to AI projects that have the potential to drive innovation and productivity within your organization.

2. Foster a culture of continuous learning: Encourage your team to stay up-to-date with the latest developments in AI and provide opportunities for skill development and training.

3. Collaborate with academia and government: Engage with universities, research institutions, and government agencies to access cutting-edge research, talent, and funding opportunities.

4. Advocate for supportive policies: Work with industry associations and policymakers to create a regulatory environment that enables responsible AI development and commercialization.

5. Prioritize talent retention and attraction: Develop strategies to retain top AI talent and attract skilled professionals from around the world to join your team.

By taking a proactive approach and implementing these strategies, you can position your organization for success in Canada’s rapidly evolving AI landscape.

Conclusion

Canada’s AI sector is facing challenges similar to those faced by Canadian hockey teams in the NHL. Just as no Canadian team has won the Stanley Cup since the Montreal Canadiens in 1993, Canada risks losing its leadership position in AI to other countries that are investing heavily and moving quickly to adopt the technology . With technology and scale effects, the winners continue to extend their advantage, making it crucial for Canada to invest early in its AI sector.

Canada has the potential to be a global leader in AI, but it must address the challenges of productivity, investment, and talent retention. By creating a more favorable environment for entrepreneurs, reducing regulatory hurdles, and investing in talent retention and attraction, Canada can unlock its AI potential and drive innovation and economic growth in the sector.

To achieve this, policymakers, industry leaders, and academic institutions must collaborate to develop a comprehensive strategy that supports the growth and development of Canada’s AI sector. By working together and addressing these challenges head-on, Canada can secure its position as a global AI powerhouse and reap the benefits of this transformative technology.

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