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Waterloo-based Communitech will get $18 million, MaRS Discovery District will get $17.5 million and Invest Ottawa will get $16.9 million as part of a new Scale-Up Program meant to help 30 Ontario firms reach annual revenues of $100 million by 2024. The prime minister said the program will create 18,000 “high-paying middle-class” jobs and attract more than $4 billion in investments. Meanwhile, Innovation Minister Navdeep Bains announced $500,000 for the Northwestern Ontario Innovation Centre in Kenora. (The Logic)

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Talking point: In October 2018, The Logic published an internal government report that outlined a proposed scale-up program seeking to build 25 companies with annual revenues of over $100 million in the next 10 years. Tuesday’s announcement proposes a shorter timeline and more high-growth firms, but is short on specifics on how to hit those goals. The October report, by contrast, had plenty of specifics on how to create $100-million firms. It suggested a “lifetime limit” for companies receiving government funding. It also suggests dramatically reforming the Scientific Research and Experimental Development tax-credit program and changing the behaviour of the Business Development Bank of Canada and Export Development Canada to stop being what the report describes as risk-averse.

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The Shenzhen-based technology giant hired Joe Jordan—a former parliamentary secretary to prime minister Jean Chrétien and senior associate for lobby firm Bluesky Strategy Group—to lobby the federal government about “the location of an artificial-intelligence research centre in Canada.” (The Globe and Mail)

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Talking point: Huawei has been making its interest in Canada as a research hub known while Ottawa’s long deliberations continue over whether to allow the company to participate in its 5G networks. CEO Ren Zhengfei went so far as to offer to fund the country’s fledgling AI sector: “If they need more money, I can give them money,” he told The Globe and Mail late last year. “I’m richer than the Canadian government.” Ren also floated the idea of moving Huawei’s U.S. research centre to Canada after Washington placed restrictions on the firm and urged its allies to do the same. The recent lobbying activity suggests Ren’s public remarks may be more than hot air, and could add to the pressure on Canada as it weighs whether to heed U.S. warnings. On Thursday, former Google CEO Eric Schmidt echoed concerns that Huawei poses a national security threat: “There’s no question that information from Huawei routers has ultimately ended up in hands that would appear to be the state,” he told the BBC. “We’re sure it happened.”

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The funding will be spread across 18 cleantech companies, including JDRF Electromag, which produces low-energy lighting for commercial buildings; Kruger Biomaterials, whose technology lowers greenhouse gas emissions from concrete use; and HD-Petroleum, which converts used oil into fuel. Innovation Minister Navdeep Bains made the announcement at Sustainable Development Technology Canada’s (SDTC) annual public meeting on Thursday. (The Logic)

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Talking point: At Thursday’s meeting, Leah Lawrence, SDTC’s president and CEO, emphasized growing competition for talent and intellectual property (IP) in the sector, as countries like China, the U.S. and the U.K. ramp up their own cleantech investments. Those countries—along with Japan, India and Germany—each invested more than US$10 billion in cleantech in 2018; Canada invested US$2.2 billion that year, 34 per cent lower than its 2017 funding. With cleantech poised to become a $2.5-trillion industry globally by 2022—according to Smart Prosperity Institute, an environmental think tank—there’s pressure on Canada to keep up by churning out commercializable technologies. Earlier in August, the government announced a $30-million patent collective to help firms find patents and protect their IP. To start, the pilot is prioritizing the cleantech sector.

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The funding follows the Hamilton, Ont.-based steel company’s second-quarter results, in which it reported a 96 per cent drop in adjusted net income compared to the same period last year, from $165 million to $6 million. The investment is being made through the government’s Strategic Innovation Fund. (Hamilton Spectator)

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Talking point: Alan Kestenbaum, Stelco’s executive chairman, said the steep decline in after-tax income had to do in large part with the 25 per cent tariffs the U.S. imposed on Canadian steel in March 2018. Ottawa’s funding follows another $50-million investment it gave to Stelco competitor ArcelorMittal Dofasco in October, which the government said was part of a $2-billion support package in response to the tariffs. Canada-wide steel exports declined 22 per cent between March 2018 and March 2019. Although the tariffs were lifted this May, there are signs Stelco—which employs more than 2,200 people in Southern Ontario—hasn’t recovered: after a brief jump following the levy being cancelled, its stock plunged to lower than it was when tariffs were in place.

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The funding aims to help small- and medium-sized firms in British Columbia expand their operations in Canada. The money will go to support everything from developing hydrogen fuel-delivery technology at Hydrogen Technology & Energy Corporation in Vancouver—where the announcement took place—to optimizing the manufacturing of waterpark parts and systems at Waterplay in Kelowna. The investment will help create some 800 jobs throughout B.C., according to the release. (The Logic)

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Talking point: With over half (11) of the 17 companies being based in Vancouver, the province’s most populous city will see a majority of the benefits stemming from the funding. The investment is part of the federal government’s commitment made in Budget 2018 to help grow Western Canada’s economy. According to a 2016 government report, the region typically sees fewer venture capital investments than Ontario and Quebec. That gap provides greater incentive for small- and medium-sized businesses to engage in government-funding programs such as the Business Scale-up and Productivity program, through which these most recent investments were made.

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The conglomerate of healthcare institutions, dubbed Can Health Network, will include Trillium Health Partners, University Health Network, Sunnybrook Health Sciences Centre and Saskatchewan Health Authority, as first reported by The Globe and Mail. The members will guide medtech startups on where to focus their R&D. Once a technology is proven, the institutions will be able to bypass certain steps in the standard procurement process to buy it. (The Logic, Globe and Mail)

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Talking point: There’s a leak in the innovation pipeline between medtech R&D and commercialization in Canada—an October 2018 report from the University of Toronto’s Impact Centre found that governments and universities’ spending on medical R&D returns about 50 cents on the dollar each year. The report identified Canada’s complex healthcare procurement process as a reason for the inefficiency. It’s a challenge myriad stakeholders are trying to address. The Ontario government is planning an expert panel to study inefficiencies with commercializing research from universities and their affiliated health networks. And, in June, Intellijoint Surgical, a Kitchener-Waterloo-based medical-device company, announced a new medtech innovation hub in the region. Those initiatives target the R&D and funding aspects of medtech, without solving the purchasing challenges, which Can Health Network is designed to do.