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Wednesday, August 25, 2010

Pushing Forward Tech Innovation Through IEPs

This article has several good points about using IEPs (internationally educated professionals) to drive Canada's pace of technological innovation, but sidetracks from the root causes (e.g., government/tax incentives, education system, appropriate labor supply...).


Canada faces a serious challenge. It must improve technological innovation, particularly commercialization performance. As a partial remedy, Canada has adopted an immigration policy designed to attract internationally educated professionals (IEPs) to help build the country's technology sectors. At present, it appears that this objective has not been entirely successful despite the growing number of skilled immigrants who arrive in Canada with increased levels of education.

Many IEPs, unable to enter the profession in which they have training and experience, are gravitating toward two unanticipated paths: moving down, that is, working in sectors where their skills are largely unused or underused; or, moving away -- returning to their country of origin where they can pursue entrepreneurial opportunities by utilizing their skills and international social connections.

When the IEPs return to their countries of origin, there is often an assumption that this reverse-migration amounts to "brain drain," a phenomenon that is historically associated with poor and developing countries. While some authors have observed certain benefits of the trend to transnational migration, such as bilateral trade and investment, most researchers believe that this reverse-migration has defeated the objective of using IEPs to enhance Canada's knowledge economy and innovation performance.

However, at Ryerson's International Research Institute, our extensive research and fieldwork with the Chinese community in Canada suggests that the transnational entrepreneurial activities carried out by the IEPs may benefit Canada as well as China, and thus this transnational flow offers opportunities for a healthy circulation of knowledge between both countries

First, the Chinese transnational entrepreneurs (TE) are highly skilled and educated, professionally established and likely to have educational credentials and work experience in both China and Canada--indeed, in some cases, individuals have a multinational resume of education and work experiences beyond the two countries. Rather than clearly repatriating to China, an increasing number of these professionals have adopted a transnational lifestyle with Canada as their home base. A key difference between the transnational and the returnee segments of the immigrant community is that the transnational entrepreneurs are more likely to maintain a strong desire to engage Canada in their cross-border entrepreneurial endeavours in addition to choosing Canada as their home base.

Second, given the TEs' skills and educational backgrounds, their business tends to entail knowledge flows and technological innovations. Depending on factors such as the types of the industry and nature of the innovation, a TE may choose to engage China in a variety of ways. In other words, TEs have followed different mechanisms to link Canada and China in crossborder innovation activities. Evidence shows that Canada can reap broad benefits from such cross-border activities by:

- Taking advantage of innovative ideas and original research from China;

- Enabling the production possibilities necessary for viable commercialization; and

- Enhancing the sale of technology-embedded products in Canada, China and other global markets.

Third, there are many good reasons to engage China in the commercialization of innovation. China offers a large talent pool, a dramatic increase in R&D expenditures, the existence of complementary knowledge and skills in certain technological fields, and an increasingly favourable environment for commercialization, as well as the country's huge market size. Commenting on some people's outdated belief that China remains backward in national technological performance, Chinese entrepreneurs have cited their nation's ascendancy to the forefront of several emerging new technologies. In clean-tech, for instance, some U.S. companies have signed licensing deals with Chinese firms to get access to their breakthrough technology.

Despite the promise of border-crossing innovation activities, the TEs have expressed deep concerns with challenges that may force them to make a Canada-or-China choice, even though most prefer Canada as a home base. The challenges include the uncertainties concerning regulatory frameworks on intellectual property rights, taxation, etc. within and across countries, and difficulties with respect to sources of such necessities as financing and social networking, and an absence of civil and community trust and support.

Clearly, using TEs as international innovation linkages is a bold proposition that requires some fundamental changes in orientation. We need to make a conscious effort to gain innovation benefits from participation in the global supply chain and to promote TEs as an alternative way for immigrants to contribute to the Canadian economy.

To leverage this opportunity, Canada may take several near and long-term actions:

- Establish a Canada-based innovation and entrepreneurship platform to provide inspiration, information, and support for TEs.

- Engaging TEs' countries of origin in the coordination of migration-mediated crossborder innovation activities.

- Develop frameworks for international innovation collaboration relating to issues such as taxation, intellectual property rights, and citizenship.

Canada's less-than-stellar innovation performance, chiefly in the area of commercialization, is not incurable. A change in orientation could help us to take full advantage of internationally educated professionals in cross-border innovative activities wherein both Canada and its international partners win.


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