Thunderbird School of Global Management\'s findings on the economic activity between Canada and Arizona.

1. CONSULTING
PROJECT:
C ONSULTANTS :
A RIZONA -C ANADA E DWARD M ATLOUB
S UPPLY C HAIN M ATT W ILLIAMSON
LANDSCAPE F IKRE G URJA
A NALYSIS S AMPAD DAS
Y UTAKA OYAMA
R OHAN V ERMA
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2. P ROJECT G OALS
• Analyze the trade trends between Canada and MAG region
• Identify industries and companies crucial to trade between the two
regions
• Identify economic development opportunities based on these
industries and trading trends
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3. P HASES
Phase 1: Identify goods traded between Arizona and Canada
Phase 2: Identify Canadian Provinces/Metros that do the most trade
with the MAG region
Phase 3: Identify key companies and Metro specific trends
Phase 4: Analysis Results & Final Recommendations
by April 30, 2012
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4. K EY F INDINGS
• S TRONG BI - COASTAL TRADE PATTERN
• A EROSPACE : INTEGRATE , COLLABORATE , CONSOLIDATE
• C LEAN - ENERGY: COMPETITIVE ADVANTAGE , OPPORTUNITY TO TRADE
WITH C ANADA
• I NDUSTRY SPECIFIC CLUSTER DEVELOPMENT IS ESSENTIAL FOR
FURTHER DEVELOPMENT
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5. Why Canada?
• Significant Trading Partner:
US-Canada bilateral trade 2011
-2 nd largest export market Total trade
California
6.0% Texas
-4 th largest import market 5.9%
$557 Billion
Arizona
$3bn
0.5%
Source: US Census Bureau – Foreign Trade
• Cultural & economic fit:
• Tourism Other
• Investment 87.6%
• Trade
• Canadian-owned companies employ Source: Industry Canada Trade Data Online
13,156 people in 736 locations in Arizona!
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6. Canadian Provinces
 Total Population is 34.1million the majority of
whom live near the US border
 2011 Canada GDP growth at 2.3%
 Metro populations (2011):
◦ Toronto ~5.6m
◦ Montreal ~3.8m
◦ Vancouver~2.3m
◦ Ottawa ~ 1.2m
◦ Calgary ~1.2m
◦ Edmonton ~1.2m
Population: 26.62%
GDP Growth: 3.63%
Population: 66.67%
GDP Growth: 1.75%
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7. Trade between Arizona and Canada
% of Total Exports by Region - 2011
Trade Trends British Others
1,800 Columbia 9%
1,600
1,546 1,566 11%
1,401
1,400
Total Values ($ Millions)
Ontario
1,383 1,182 1,202 1,363 Alberta
45%
1,200 12%
1,216 1,055 Quebec
1,000
23%
800 895
% of Total Imports by Region - 2011
600
Alberta Others
400 8% 4%
British
200 Columbia
0 12%
2007 2008 2009 2010 2011 Quebec Ontario
14% 62%
AZ Exports to Canada AZ Imports from Canada
Source: Industry Canada Trade Data Online
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8. AZ Exports to Canada - 2011
Aerospace products and parts
Navigational, measuring, medical and
control instruments
Automobile and light-duty motor vehicles
Computer and peripherals
Agricultural products
British
Columbia Alberta
Quebec
$32M
$24M
Ontario
$73M $159M
$41M $43M
$24M$24M
$27M
Source: Industry Canada Trade Data Online
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9. AZ Imports from Canada-2011
Aerospace products and parts
Navigational, measuring, medical and
control instruments
Automotive
Commercial and service industry machinery
Wood and wood products
British
Columbia
Alberta
$41M
Quebec
Ontario
$52M $26M
$41M
Source: Industry Canada Trade Data Online
$140M
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10. Canadian Metro Landscape
Vancouver Calgary/Edmonton Toronto Montreal
Digital Media Energy Aerospace Aerospace
Utilities
Mining
Finance
Life Sciences
SURE Cluster
Technology Automotive
Technology
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11. Canada - Aerospace Landscape
Atlantic
Canada
5.6%
Western
Canada
13.6% Quebec
51.9%
Ontario
28.9%
Canadian aerospace revenue by region
Edmonton
Vancouver Avionics Other Space
4.7% 4.6% 3.4%
Calgary
Montreal Simulation
& Training
5.1%
Toronto
Aircraft Aircraft
Engines 49.2%
13.8%
Aircraft assembly & engine manufacturing Aircraft
MRO-
Aircraft parts manufacturing & systems development 19.2%
Robotics, navigation systems & MRO
Helicopter services , training centers & design
Canadian aerospace revenue by subsectors
Source: Deloitte – Profile of the Canadian 11
Aerospace industry 2010

12. Aerospace: Bilateral Trade
$400 mm
$120 mm
$55 mm
• Honeywell leading supplier of Avionics, Propulsion Systems and APUs in
Bombardier’s product line.
• Booming Asian Aerospace industry strengthens this relationship
Increased trade & collaboration
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13. Aerospace Action Plan
Goal
Utilize academic institutions to attract and retain top aerospace firms
Academic Competitive Advantage
Institute Core Competencies
Aerodynamics and Fluid Mechanics, Helicopter
Electromagnetics, Control Systems, Combustion
Dynamics, Aeronautical Management Technology
Opportunities
Companies Research Institute Education Industrial Association
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14. Canada – Energy Industry Landscape
Renewable Energy
Source: Calgary Economic Development :
“Sustainable and Renewable Energy”.
Source: Canadian Centre for Energy Information
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15. Epcor’s $470mm Investment in AZ
• Diversified electricity and water services provider headquartered
in Edmonton, Alberta
• Wholly-owned by the City of Edmonton for over 100 years
• Strategy:
– Pursue rate regulated and long term contracted investment
opportunities
Acquired
Chaparral City Water Company
Source: EPCOR Utilities Inc.:
Investor Presentation-Feb 2012 15

16. Capital Power Opportunity
• Solar Sales in the valley are rising and investment is increasing
• Epcor has a minority interest in Capital Power
• Opportunity for Capital Power to expand Energy (Solar) presence
in the valley
• Solar special use permit anticipated to be filed Q1-2012
 Capital Power’s Operations and Western
Canada
growth focus on four energy sources:
Ontario
Pacific US
Northwest Northeast
49% 36%
Mid-
Atlantic US
US
Southwest
EXPLORING
14% DEVELOPMENT
Plants in operation
Plants under construction or development
Source: Capital Power Corporation:
Investor Meetings-Stuart Lee, SVP
Finance & CFO. January, 2012
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17. Renewable Energy Action Plan
• AZ Solar Industry: $2bn, 16K jobs
• Growth - 333% v/s 109% US avg.
• Additional 2,100 jobs; more than
$1 billion invested since 2010
• Aggressively promote renewable
energy target of 15% by 2025
• Strengthen associations like
AriSEIA – major competitive
advantage
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Source: Phoenix Business Journal

18. Summary
Western Canada Eastern Canada
• Focused on Tourism & • High value trading partner
Investment • Top trading industry:
• Top trading industry: Aerospace & Equipment
Agriculture manufacturing
• Opportunity to promote & • Consider: Supplier
partner in clean energy database for Aerospace &
growth focus research partnership with
Institutions
Partnership with industry clusters , trade associations &
Economic Development Committee's is vital
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19. Important Observations
• Establish working relationships with Economic Development
Committee's in major Canadian metros
• Ensure that industry clusters in key Canadian cities are
aligned to those in AZ
• Infrastructure must support these clusters
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20. THANK YOU FOR YOUR TIME
C ONSULTANTS :
E DWARD M ATLOUB Q&A
M ATT W ILLIAMSON
F IKRE G URJA
S AMPAD DAS
Y UTAKA OYAMA
R OHAN V ERMA
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