What is Canada’s Opportunity?
Semiconductors are the backbone of the modern electronics industry. Most of the time we hear about modern “mega-fabs” from companies like TSMC which manufacture large quantities of silicon semiconductors or about chip design firms like NVIDIA or Intel that design integrated circuits using multiple silicon semiconductors to create the CPUs and GPUs that are the backbone of personal computing as well as large scale datacentres.
However, there is another kind of semiconductor compound semiconductors – so called because unlike silicon semiconductors they are made out of a combination of elements like Indium Phosphide (InP) or Gallium arsenide (GaAs) – that are equally as important to modern advanced technology. Compound semiconductors have different properties that make them unsuitable for general-purpose computing units like CPUs and GPUs. However, they are crucial for rapid information transfer, underpinning all telecommunications and datacommunications, as well as applications such as high-speed signals in 5G, satellite comms and specialized defence radar systems.
I’d take anything from Build Canada with a Shopify billionaire-branded bucket of salt.
With that said - yeah we theoretically couls do semis, if we develop the education capacity that then develops the workforce capacity which would do the R&D. Except that’s a decade+ project so we need to be able to do national level long-term industrial development planning. Can we do that? I think experience over the last couple of decades points to no. Neither of the two parties regularly administering our economy has been doing that for a long time. Instead they rely primarily on markets and so we are where we are. Until we make an ideological shift away from that, get closer to what we used to do when we developed the difficult stuff through crown corps, and funded public R&D consistently, I don’t think we’re getting semicon manufacturing, among other things in Canada. And Build Canada won’t be advoctaing for that. If in doubt:
What Must Be Done
Canada can learn from these examples to transform the know-how and capital locked up in CPFC into a world class company and ecosystem of compound semiconductor development. A shining opportunity to create a new batch of future global champions. The first key step is bringing in private partners and recapitalizing the fab following the successful examples with CN rail, and Petro-Canada4.
They’ve identified a remnant of the public R&D investment we used to do and want the gov’t to sell it to them. You know, like the joyful privatization of CN Rail.
Your take on this is excellent. I feel like the Canadian political and capital classes have fallen for this belief that if only we incentivize enough private investment, then all our problems can be solved. There has been a serious generational neglect of investment in developing local expertise (see health care, science, infrastructure development, etc etc) because feds and provinces don’t want to fork up the capital to build and maintain the social systems required to develop these expertise.
Privatizing a government R&D program is pretty much the exact opposite thing to do if you want to achieve this. It ensures that priorities will shift away from long term projects and providing consistent work for Canadian scientists and towards the short term thinking of corporations who do not care about building any kind of social or educational infrastructure and only care about juicing as much as they can out of the asset as it exists today.
Canada seems to be great at building corporations, not so good at making them last. We have the research and development smarts, we just have a very big problem with growing good managers that do not have pointy hairdos.
