COVID-19 has exposed the depth of economic and social vulnerabilities in the Northwest Territories, particularly in small communities, from health care access to reliance on airlines for food security to the lack of internet connectivity in homes. Our non-public sector economy is driven by the mineral resource industry, primarily diamonds, a luxury-good commodity market susceptible to fluctuations outside of our control. Our population has many pre-existing health vulnerabilities, low rates of educational outcomes and a recent history of both individual and collective trauma stemming in part from residential schools. COVID-19 has brought the collective impacts of these realities, and other challenges, into sharp focus.
Even with all this adversity, I am proud of the way that Northwest Territories residents, businesses and governments have rallied to respect the health measures put in place to minimize COVID-19 cases and keep it out of our remote communities.
My opening comments will speak to both our challenges and our opportunities that COVID-19 has brought into sharp focus and the responses we believe are needed to build a strong, sustainable north.
Our people: The Northwest Territories is made up of strong, resilient people. We are at our best when we work together, as is demonstrated by active collaboration between public and Indigenous governments.
Mineral resources: Significant mineral resource potential across the NWT’s vast geography continues to exist. Notable examples are lithium and rare earth minerals which could gain greater prominence if COVID-19 advances the conversation about increased use of technology green energy.
The NWT is a key entry point to the Arctic Ocean and the Northwest Passage: The geopolitical importance of the Arctic as well as direct economic potential is unaffected by COVID-19.
Cultural diversity: Celebrate and protect 11 official languages, each one translated in our Legislative Assembly. Cultural knowledge, particularly interest in Indigenous cultures and language, is an area of growing interest around the world.
Many of our strengths have not been diminished by COVID-19. Anecdotal evidence thus far suggests that the aggressive measures announced by the federal government combined with our own government’s support for Northwest Territories residents and businesses will do much to stabilize the immediate economic situation. We are especially appreciative of the programs targeted specifically for the North such as the $8.7 million to support NWT airlines to ensure continued supply.
Challenges brought into focus by COVID-19
The NWT has the largest infrastructure deficit in Canada. We have airports that allow limited aircraft, a small handful of emergency shelters in only a few regional centres and high food insecurity. COVID-19 has highlighted and in some cases exacerbated these weaknesses.
Education: Many schools outside of the capital rely on teachers who travel to southern Canada, or abroad, during all school breaks and many of those school districts still do not have a full complement of teachers returned after “March break.” Every school district is struggling to provide web-based schooling without sufficient access to computer hardware in homes and limited internet connectivity across the Territory.
Heat and energy sources: People staying home has resulted in higher energy use in an already high cost environment. Of note, most communities rely on diesel fuel to heat their homes and often as the community’s primary electricity generation. Lest you think the recent fuel price drop is helpful, keep in mind that fuel is purchased far in advance and sent to communities on ice roads. Fuel delivered to communities in February and March was at a much higher price than we see today.
Overcrowded housing and housing insecurity leading to intransient housing puts more people into contact with one another, often simultaneously suffering from lower pre-existing health resiliency. This is a perfect environment for COVID-19 to spread.
A lack of transportation infrastructures results in communities depending on airlines for food and medical supply chains. Those airlines today are in trouble, with at least one having closed its doors already.
At present, we have limited own source revenue options. Those revenues have been further depleted by our efforts to provide immediate relief to the financial pressures created by the collective response to COVID-19. In addition, the reduction in revenue resulting from a loss in personal and corporate income as well as mineral royalties is expected to have a major impact. Although we appreciate the financial help from Canada to date, we will need more.
We already have limited fiscal room which impacts our ability to be primary investors in major projects and can create fiscal challenges to act as partners if an investment relationship is predefined.
We were forced to hit a pause button on regular government business and the pursuit of our Government’s priorities in order to contain COVID-19 but as we plan to restart, we have the opportunity to think about what that restart will look like, with a vision of who we want to be in the future.
We are assessing which projects are shovel ready but could be delayed due to fiscal constraints.
We also have several projects that are what I call next-stage ready. These are projects that are at some stage of design, planning or permitting. These include:
- Telecommunications connectivity expansion and capacity improvement;
- The expansion of hydroelectric capacity at the Taltson hydro facility with a view to moving the NWT towards cleaner energy both in homes and available to industry so that we can be leader in greener mining, for example;
- Exploration of the Slave Geological Province and the potential to provide the first direct transportation corridor to Nunavut;
- The expansion of hydro electricity transmission lines across the south; and
- The introduction and expansion of community based solar and wind projects.
- Ensure sufficient borrowing flexibility and a broader diversity of infrastructure investment partnership options including opportunities for Indigenous Governments as equity partners. This includes being able to stack funding and in some cases 100% dollars;
- Advance the Broadband 2020 Fund and the promise of broadband access into all homes and communities in the Northwest Territories; and
- Identify social and economic goals within the Arctic and Northern Policy Framework that can be funded for action immediately or funded for immediate next stage planning and commit to doing so in collaboration with the arctic and northern communities who are eager to be on par with the rest of Canada.
We know that countries that invest in the Arctic see real benefits, whether from the natural resources, the access to traditional knowledge or new opportunities in communications and transportation. We believe this is true of Canada’s north as well. We look forward to a continuing partnership with Canada to achieve this goal.