Every industry around the world has — or will — become a digital industry in some way or other. And that means practically limitless export opportunities for Canadian information and communications technology (ICT) companies wishing to expand beyond the domestic market.
Our country is comparatively well positioned to seize those opportunities thanks to a long history of producing innovative ICT solutions. Canada’s world-leading capabilities include telecommunications, secure network design and implementation, simulation and training software, advanced graphics processing, cyber security and much more.
But given the sheer breadth market demand in the ICT sector, which spans everything from telecommunications networks, to cyber protection software and systems, advanced military battle-space visualization, and financial and regulatory technologies leveraging advanced analytics and machine learning, it is difficult to know where the best opportunities for Canadian firms lie — and what is required to take advantage of them
Working together to meet foreign government needs
CCC ICT Sector Director Jeff Tasseron says that when it comes to exporting Canadian ICT products and services, foreign government buyers can have a wide range of different needs. Some require unique solutions, and are comfortable buying individual components that can be integrated into their existing systems. Others want a complete solution that works right out of the box, and reduces implementation and operation risk.
While Canadian companies are especially good at producing innovative, specialized solutions, Canada does not yet have a critical mass of companies able to bring truly turnkey, fully integrated offerings to the market. For Tasseron, that points to an emerging area of opportunity where CCC’s government to government mechanism can be a significant competitive differentiator.
“We often suggest that small and medium-sized companies consider earlier-stage collaboration to assemble end-to-end solutions.” Even if they don’t have all the tech in their own individual portfolios, by working together, or by selling through larger players in complementary market spaces, many Canadian companies have the capacity to punch above their weight – particularly when their offering comes with a Government of Canada guarantee of performance.”
He says that the CCC model is particularly relevant in emerging markets that are looking to transform their ICT infrastructure, but don’t yet have the technological sophistication or familiarity to integrate multiple components themselves“They don’t always need cutting-edge solutions,” says Jeff. “In many cases, they‘re looking for solid, proven functionality and a partner who can work with them every step of the way.” Similarly, he notes that many international buyers, particularly outside of the G20, experience multiple rounds of failed or under performing procurement in the more technically demanding ICT domain. “The opportunity to work with reliable, fully-qualified Canadian companies under the auspices of a government-to-government relationship can be a powerful draw for countries seeking to upgrade their ICT infrastructure.”
WHAT FOREIGN GOVERNMENTS ARE BUYING
Jeff identifies the following as the top five ICT areas of investment for foreign government buyers interested in government-to-government contracting:
1. Public safety and security
Many governments are turning to digital technologies to enhance the provision of public safety and security services. This demands new hardware and software that can be used to screen packages at airports, ensure reliable communications, and improve situational awareness for emergency responders. The sub-sector also comprises technologies for facial recognition, electronic identification documents, and emergency management decision support tools – all of which need resilient, secure, high-bandwidth networks to ensure the capabilities are available whenever and wherever they’re needed
2. Cyber security infrastructure
As more services and infrastructure go digital, and as data protection and privacy concerns mount, government buyers around the world are seeking to upgrade or replace legacy systems. Commitments to privacy standards such as the General Data Protection Regulation (GDPR) require governments to examine and upgrade their ICT infrastructure and practices to ensure they can collect, store and share their citizens’ information securely, and protect it from exposure and misuse. For Canadian companies, particularly those with existing products in Federal or Provincial service, this sub-sector offers many opportunities to establish long-term, high-value export relationships.
3. Smart public infrastructure
While consumer goods often exemplify the ever-expanding footprint of Internet of Things (IoT) / network-enabled devices, an equally profound revolution is going on behind the scenes, in the industrial and system controls architecture that underpins todays “smarter cities.” Custom-designed high-reliability private networks are being used to monitor and manage utility meters, traffic lights and complex webs of sensors that permit cities to function safely and efficiently. As population densities increase, particularly in developing nations, much of this smart infrastructure is yet to be built, providing massive opportunities for Canadian companies working in the space.
4. Financial and regulatory technologies (FinTech . RegTech)
Worldwide demand for greater access to online services has affected all sectors, including the financial sector, as well as the policy and regulatory space. Governments need the most advanced technology for banks, taxation systems and land valuation registries — and it has to adhere to and keep up with strict privacy and security regulations, while remaining accessible to legitimate users. FinTech and RegTech are also the sectors seeing some of the most exciting analytical and machine learning opportunities, with companies racing to extract value from the vast amounts of data being collected, and governments seeking to streamline their services and increase efficiency.
5. Simulation and training
Technologies that originated in the military or aerospace sectors are increasingly being used in other fields. Workers in dangerous jobs, from emergency responders to power plant and mine operators, are using virtual reality, augmented reality and other simulation technologies to gain the skills they need to function safely in real-world conditions. Canada is an acknowledged world leader in this area, with graphics and image processing hardware expertise, a pedigree of high-end simulation and gamification companies, and a rich history of pioneering computer-based training and instruction in the military and aerospace domains.
REGIONAL TRENDS AND HIGHLIGHTS
Different geographic regions have different ICT requirements, presenting a range of opportunities for Canadian exporters. While nearly every market is expanding its use of digital technologies, Jeff notes the following that may be of particular interest to Canadian exporters:
South America and Mexico — These countries are developing rapidly, and are reaching the point where they have concluded that they need to make major investments to revamp their public infrastructure, to support their growing populations and sustain their industrial capacity. Existing ICT systems will require upgrades or all-new installations, in many cases accompanied by organizational and process reforms. Canada has longstanding relationships in these markets, and Canadian firms can be less intimidating to work with than large multinationals.This enhances buyer confidence and can underpin sole-source awards.
Asia — New trade agreements are providing Canadian companies with greater access to Asian countries, whose governments are particularly interested in solutions that will put them on even technological footing with their Western trading partners. Demand for cyber security and data protection technologies appears strong, with growing demand for public safety and smart infrastructure projects.
Africa and the Middle East — Smart public infrastructure is extremely limited in these markets and, in many cases, needs to be built from the ground up. This offers tremendous opportunities for exporters of IoT solutions who can help these markets very quickly close the smart cities gap (as was seen with the explosive growth in cellular technology over the past decade). Similarly, these countries offer excellent opportunities in FinTech and RegTech, as they begin to reform and reposition their national institutions, and work to expand their ability to reliably collect taxes and fees, and generally monetize their government services.
Overall, Jeff notes that CCC can be a great tool to help Canadian exporters identify and make inroads into the most promising markets.
“ICT is evolving so rapidly, it’s not always obvious where the best hunting grounds are,” he says. “But between our network of regional directors, and our colleagues in the Trade Commissioner service, we have people all over the world who are talking to foreign buyers and finding out what they need, so we can bring in Canadian companies to help meet those needs.”
If you’re an ICT exporter looking to expand into international markets, CCC can help you. Contact us at 1-800-7488191 or firstname.lastname@example.org to find out how.