canada games the capital city competition

Charlottetown, PEI Team Yukon is at the Canada Games in Charlottetown this week.

Charlottetown, PEI

Team Yukon is at the Canada Games in Charlottetown this week. The Yukon News’

Tom Patrick is covering sports, while this correspondent – tagging along as unofficial Team Yukon economist – will report on how our economy is performing compared to its Maritime rivals.

This will require a careful examination of key economic sectors, including tourism (beaches and golf courses), services (theatres and pubs) and resource industries (lobster).

Prince Edward Island appears relatively prosperous despite its famous reliance on primary industries such as potatoes and the commercial fishery. This is puzzling, because fish stocks are under pressure and agriculture employs steadily fewer people even as output goes up.

A closer look reveals that the island’s prosperity declines the farther you get from Charlottetown, and that the city itself has turned into a major engine of PEI’s economy. A subtle shift has occurred in the island’s economic structure. Instead of the city serving as the warehouse for wealth-creating businesses in the countryside and fishing ports, it is now the city where the wealth creation occurs.

As many urban economists report, most people in rich economies now live in cities. This enables the networks and co-operation needed for complex – and well-paying – service industries ranging from marketing to engineering to web design. Even tourists are spending more time in cities. Visits to New York are up significantly, for example, while wilderness icons like Yosemite languish.

Charlottetown is interesting for someone from Whitehorse. It has only 32,000 people, just 9,000 more than our city. The entire province, all within roughly an hour’s drive of the capital, has only four times as many people as the Yukon. Yet the city has a broader economic base and gives us a few things to think about as Whitehorse keeps growing.

So let’s look at what is making Charlottetown successful.

Interestingly, it’s not fishing and agriculture, although they still play a role, of course.

The first thing that strikes the visiting economist is the size of Charlottetown’s “knowledge sector.”

The University of PEI plays a major role in the city, with a large campus just north of the old town. It has about 4,000 students and recently ranked in the top 10 Canadian undergraduate programs in the Maclean’s magazine university survey. UPEI is a great asset to the city, as well as a major driver of economic activity. Furthermore, there is a nearby web of research institutions such as a National Research Council facility and a federal crop and livestock research station. Importantly, research-based entrepreneurs cluster around campus.

The future Whitehorse version of this would have Yukon College as a full university with a strong undergraduate program, connected with well-funded and active research institutes in climate and environmental research, geology and northern engineering and technology studies.

In PEI all of this is supported by a robust telecommunications infrastructure, with multiple connections to the mainland so the internet does not go down if a road crew wrecks a cable.

Second, Charlottetown has an active arts community.

Charlottetown built its ugly, boxy theatre downtown instead of out of sight in the suburbs. The Confederation Centre of the Arts has a vibrant program and large numbers of tourists and locals seem to enjoy having dinner and seeing a show. Other artistic establishments cluster nearby. The local equivalent of the Frantic Follies, based on Anne of Green Gables, of course, seems popular.

The Yukoners behind establishing the Old Fire Hall and other arts facilities downtown are headed in the right direction.

Third, high-value-added food plays an important role. In addition to the cheap and cheerful traditional fish-and-chips stand, there is an impressive array of high-quality restaurants serving local dishes. People seem to be willing to pay high prices for authentic, artisanal or local food. We can see this in Whitehorse from the crowds outside Klondike Rib and Salmon. If we follow PEI’s lead, Yukoners will be serving a lot more tasty local food in the future, and building a local agricultural economy.

Where does all the money come from to support all this? The federal and provincial governments have allocated significant amounts of the money they spend on the island to universities and research, and not just to traditional subsidy sinkholes like commercial fishing.

Tourism is also critical. Charlottetown thrives on tourists, who spend a lot of money in the city despite having been lured to the island by traditional images of beaches, lobsters and Anne of Green Gables. T-shirts from Vermont to Toronto can be seen in the museums and the lineup for tickets to Anne of Green Gables: The Musical.

PEI is at a disadvantage compared to New Brunswick, since it is farther from the big population centres in Boston, New York and central Canada. But it has a surprisingly large number of repeat visitors, who make it a family tradition to spend a few weeks in PEI over the summer. Shaw’s Hotel has built a business since the 1860s of attracting a loyal clientele of affluent mainlanders who spend every summer on Brackley Beach.

PEI’s government also gathers significant tax revenue from its tourists, because it hits them with its 10 per cent sales tax as they pass through.

So what does all this mean for the Yukon? It tells us that when we think about economic development, we should be thinking more about Whitehorse and Dawson, and less about resurfacing the Robert Campbell Highway. The theme of Charlottetown’s success has been the mutually reinforcing trends around building an attractive city that is enjoyable to live in and visit. This creates a virtuous circle, where knowledge industry workers and tourists congregate and drive economic growth.

And if Charlottetown can do it with not much more than lobster rolls and Anne of Green Gables, so can we.

Keith Halliday is a Yukon economist and author of the Aurore of the Yukon series of historical children’s adventure novels. His latest book Game On Yukon! was just launched.