McKinsey's Newfoundland diversification report to be revealed after provincial budget
In September, NYC-based strategy firm McKinsey & Company won a $1 million contract to deliver an economic diversification report to the province of Newfoundland and Labrador. Initially set to be finished at the end of December, the report deadline has been pushed back to the end of February. McKinsey’s findings will be made public by the Newfoundland government after its annual budget is revealed six to eight weeks later. The provincial government said that the extension would not increase the $1-million price tag.
Governments often call in consulting firms to help them work out economic strategy. Premier strategy consultancy McKinsey, for example, last year delivered a plan which offered a number of possible initiatives to aid the troubled economy of Lebanon. In the aftermath, Lebanon decided to legalize the growth of marijuana, one of the economic initiatives favourably outlined in McKinsey’s report.
While relaxing cannabis laws is a moot point in Canada, the Newfoundland government wants to know what it can do to boost its economy beyond the obvious offshore oil development. As such, the province awarded the contract to McKinsey.
Newfoundland finance minister Tom Osborne said McKinsey will look into opportunities in energy, mining, tourism, aquaculture, agriculture, marine technology, and aerospace.
"The primary focus here is diversifying the economy, creating jobs, stabilizing the population, and creating a Newfoundland and Labrador as a good place to live and raise a family, and creating the employment to allow that to happen," Osborne told the CBC in September.
Long one of Canada’s poorest provinces, Newfoundland has seen large numbers of its population migrate westward to Ontario, Saskatchewan, and Alberta in search of greater economic opportunity. Combined with an aging population, out-migration has seen Newfoundland’s population drop from 580,109 in 1992 to 528,817 in 2017.
"Cabinet will need some time to review the report," Osborne told the CBC. "And you know it's certainly my intention that it will feed into budget 2019 as well. And at that particular point, the report will be released to the public."
The people of Newfoundland will then be able to see what a million bucks can buy in terms of economic strategy. "While we're not obligated to release it, we certainly will be releasing it," Osborne said.
Newfoundland’s government will likely afterwards funnel some of the money from its ocean supercluster coffers and fisheries fund to the “blank slate” economic diversification opportunities that McKinsey outlines.
