Plan Nord: Extracting the most value for Quebec
Plan Nord has long been touted as the catalyst to unlock the economic potential of Quebec’s vast north and kick-start much-needed investment in the area’s remote communities. Despite the uncertainty around global metal prices, Quebec Premier Philippe Couillard has thrown his support behind a project that has the potential to be transformational for the north of his province. The scale of investment needed is not without risk, but the government is setting up its own administrative infrastructure and approach to reduce that risk while at the same time squeezing every ounce of local benefit from this ambitious plan.
Quebec’s north is home to a rich crop of iron ore, copper, nickel, zinc, gold, uranium, cobalt, diamonds and other minerals. These minerals represent the bounty on offer, a bounty that will deliver jobs in the short term, and heavy investments in infrastructure and communities to provide a legacy for the region in the long term.
A massive injection of cash will expand, refurbish or build new ports, airport, roads and railways, as well as electricity generation to provide the necessary infrastructure for mining. Moreover, this will open up the region to industries such as sustainable forestry and tourism. There will also need to be major investments in much needed housing, community services, and amenities. By 2035, the Quebec government expects this to add up to a combined C$50 billion of public and private investment in the region.
To make the most out of every cent invested, the government is working diligently to ensure this grand vision delivers real benefits on the ground. Leading in this effort is the Société du Plan Nord, an authority set up by the government tasked with working with local groups and businesses to make the plan a reality.
One of their key mandates is to maximize the economic spin-offs for the province. This includes setting up a marketing office to raise awareness of the opportunities around the plan for local and regional suppliers and making it as easy as possible for local companies and residents to get involved.
Governments around the world are grappling with how to maximize opportunities for local companies without falling foul of international trade rules that restrict discrimination. Quebec has smartly made the investment in a team and the tools to make it accessible for local businesses to participate.
This approach was used successfully on the largest construction project in Europe; a rail line running under the heart of London called Crossrail. Despite being subject to all kinds of European Union procurement rules preventing unfair treatment of suppliers based on nationality, the organization delivering the project managed to award 95% of contracts to firms in the UK.
They did this through a combination of providing a platform that made it easier for local firms to find information, register interest, qualify and be selected. Furthermore, they held meetings across the country to share information and encourage companies to become involved. Quebec is building on that model to build local participation for Plan Nord.
It also aims to make sure that companies right across the province are aware of the opportunities, and can easily get involved. By doing this it helps win supporters across the entire province. Critical given the scale of investment involved. This process is not about excluding outside expertise, but making it easy for smaller local players to be involved.
The government has worked with local company Cognibox to set up an online marketplace for potential suppliers which will go live later this year. This platform will provide a one-stop shop for any upcoming tenders, notifications of specific needs of public and private buyers, buyer policies and qualification processes, and a variety of news, events, and advice.
This type of platform is critical for small local businesses. With so much going on across the province as Plan Nord becomes a reality, it is difficult to get a sense of what opportunities are available, particularly for smaller companies. Enabling them to prequalify for projects, and keeping processes simple, benefits smaller local firms without the resources to fill out numerous tenders and bid documents.
It has become increasingly difficult to get approval for large-scale resource and infrastructure projects anywhere. The most likely supporters for projects are local businesses and suppliers who win contracts locally. By making it as easy as possible for local companies to be involved, it not only reduces project risk, it magnifies local community benefits. As we are seeing in Quebec, an investment in engaging local businesses can pay back in spades, and quickly.