The creation of the North American Free Trade area has meant that Canadian jurisdictions have to consider more closely their advantages and weaknesses relative to those of the other national partners in this new environment for trade and investment. The North American Policy Group (NAPG) at Dalhousie University, with the support of the Atlantic Canada Opportunities Agency (ACOA), has undertaken two studies to provide objective comparisons of Atlantic Canada and international jurisdictions. The Region is treated as a single unit or jurisdiction in these studies, not as a political suggestion, but because of the complexity of presenting information on all four Provinces and also because, in a number of instances, regional data was more readily available.

The approach taken in the two studies is to develop the statistics on the Region that will allow it to be compared and ranked, as accurately as possible, with, in one case, the 50 States of the United States of America and, in the second case, with 48 "countries", including the territories of Hong Kong and Taiwan. This report focuses on the latter comparison and places Atlantic Canada in the global competitiveness context.

The utility of this comparison comes from the need to understand the advantages and challenges facing the regional economy in a broader context than an intra-Canadian comparison. Many of these latter studies have been done over the years. Given the increase in external competition resulting from liberalized trade and investment regimes, external comparisons are crucial to citizens and policymakers alike. This study aims to fill this gap.

This study also allows the Region's decision-makers to assess key indicators of competitiveness. In an era when business development depends on a wide range of factors including lifestyles, access to universities and environmental quality, an attempt has to be made to understand the challenges to the Region and to examine its advantages and disadvantages.

Finally, international competition for investment requires that the Region sees itself as others might see it. Atlantic Canadians will not benefit from uninformed opinions and prejudices that arise outside, nor are they helped by telling each other unfounded but rosy opinions and projections. Benchmark data is critical if the Region is to effectively compete for its share of investment dollars.

The comparison with the 48 countries and territories presented in this report is based on the 1995 World Competitiveness Report, published by the Institute for Management Development and the World Economic Forum in Switzerland. The World Competitiveness Report is in its 15th annual edition in 1995.It contains an overall ranking of 48 countries (including Taiwan and Hong Kong) on the basis of their international competitiveness. In 1995, the US ranked first and Canada 12th. The Report contains 378 criteria, made up of 130 that are derived from a questionnaire sent to executives in all parts of the world, and 248 based on statistical data. Of these 378 criteria, only 294 are included in the ranking process. The rest are judged to be too unreliable for this purpose. The 294 criteria are aggregated, or "rolled up" into 55 subfactors; these are then "rolled up" into 8 factors that, in turn, go into the making of the overall rank.

NAPG attempted to produce statistics and opinions on Atlantic Canada for as many of these 294 criteria as practical. Many of the data points and survey questions were available only as national, or Canadian, figures or answers, since no comparable regional statistic or proxy existed. Data about exchange rates and questions about the stock market are obvious examples in this regard. In the end, 294 factors were included in this study.

The results show that Atlantic Canada as a unit ranks 27th of 49 in terms of world competitiveness. These overall results are broken down and analyzed at the factor and subfactor levels noted above in order to more closely identify the specific areas where the Region displays strengths and weaknesses. In keeping with the format of the World Competitiveness Report, NAPG has also produced a regional "balance sheet" of those 60 criteria ("assets") where Atlantic Canada scored 15th or better and 62 criteria ("liabilities") where the Region was 37th or worse.

This balance sheet indicates that many of Atlantic Canada's assets lie in what it derives from Canada as a whole, including a strong commercial financial system and relatively free trade with the rest of the country and with the US. It is also strong in controlling inflation, the longevity of its people attitudes toward work, energy generation, agricultural productivity, higher education enrollment and health indicators, among other things.

The Region's challenges, or liabilities, are most obvious in the areas of management and technology. As well, government involvement in investment decisions, the perceived unwillingness of businesses to train employees and low growth in the volume of merchandise exports, among other things, constitute problems for competitiveness.

A major challenge to the Region lies not in the eternal comparisons between it and Alberta or Ontario, but in the more practical comparisons with places that have similar geographic and population characteristics. Specifically, what is needed is to find out what changes are necessary to enable Atlantic Canada to post scores and rankings like those of Iceland, Finland, New Zealand and Ireland. Today, the differences in overall rankings and factor rankings among these areas are as follows:

Rankings	New Zealand	Finland	Ireland	Iceland	Atlantic Canada
Domestic Economic Strength	19	29	15	37	38
Internationalization	23	12	9	39	34
Government	3	17	31	29	26
Finance	10	23	19	36	20
Infrastructure	6	7	25	8	14
Management	3	10	25	23	36
Science & Technology	22	7	18	24	29
People	12	7	32	5	23
Overall	7	16	22	25	27

The World Competitiveness Report does not make policy suggestions. Rather, it leaves the process of analyzing their results to individual countries. NAPG will do the same in this analysis, though we have provided commentary on individual criteria, subfactors and factors considerably beyond where the Swiss have gone. Some of the scores are very telling while others are, in our opinion, meaningless. Yet the overall picture does have merit and poses interesting challenges, especially as the present federal withdrawal from areas of public activity and commensurate funding require that the Provinces that make up Atlantic Canada look more to their own resources, financially and intellectually, than they have had to do for over a generation.

NAPG is not suggesting that one should conceive the Region as an actual country. It is apparent from this study that many of the strengths of the Region derive from its being part of the Canadian totality. Yet it is instructive to compare it with countries that bear some resemblance to it, if only to look for some lessons and innovations in specific areas where others are "doing it right".

Including Atlantic Canada in the 1995 World Competitiveness Report provides the businesses and governments of the Region with a large set of useful benchmarks that can be used to point to facets of the society and economy that need improving and that permit progress to be measured over time.