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11 themes for '11

For the past six decades, since Newfoundland and Labrador entered Confederation, any transition in the province's political leadership was tinged with underlying pessimism that nothing could really change.

However eloquent the leader - and the Rock's leaders are invariably eloquent - the province could never escape the harsh realities of crushing public debt, high structural unemployment, and the mantle of being Canada's perennial doormat.

But this time, it's not like that.

When Premier Danny Williams retired in late November, he left behind a different kind of legacy - that 2011 will be Newfoundland and Labrador's moment, when the province cashes in on its great promise to become Canada's Atlantic powerhouse.

After being belittled by Ontario and the West, and trampled by big neighbour Quebec's nationalistic ambitions, the people in Canada's eastern-most province are poised to become Maîtres chez Newf. They are about to ride a resources bounty, a strengthening fiscal regime, and a resurgent optimism into a new status as a labour and investment magnet.

"Those people who once saw us as the poor cousins of Confederation now see us as the place to be: a province on the move," Mr. Williams said in his retirement statement which, if anything, was more subdued than the economic reality.

The spirit of the new age was captured in Mr. Williams' last major act as premier to announce plans for the $6.2-billion Lower Churchill power project in Labrador, a deal that promises to bury some of the debilitating phobias held by people in the province.

After four decades of tears and jeers over a bad deal on the Upper Churchill mega-project, the province is poised to cash in on a new hydro project and a new partnership with Nova Scotia.

It thus takes an end-run around troublesome Quebec, which not only reaped a sweetheart deal on Upper Churchill but resisted Newfoundland's requests for overland transmission from Lower Churchill.

And there is more. Predictions of oil prices hitting $100 (U.S.) a barrel in 2011 leave Newfoundland well-positioned as a petro power, with a constant stream of new and continuing offshore fields. The Hebron field is about to start development, and there are extensions to White Rose and Hibernia.

Newfoundland has learned that the life of a resources superpower is choppy and unpredictable. The key is to hold steady in the rough water until price cycles swing back your way.

In 2009, the province's GDP plunged by 10 per cent on sharply lower commodity prices. But as energy came roaring back, so did the Rock. The province is expected to have grown by 5 per cent in 2010 and to expand by 3.8 per cent this year, economists at Royal Bank of Canada estimate. Only Alberta and Saskatchewan are expected to show stronger growth in 2011.

In addition, the province remains a hotbed of new mineral activity, led by the future promise of the Voisey's Bay nickel deposit and a new nickel processing plant. Tourism remains a strong contributor through television ads that capture the province's raw beauty and history as the cradle of European settlement in North America.

The big prize, both economically and psychologically, will come in 30 years, when the Upper Churchill reverts to Newfoundland's jurisdiction - underscoring a dramatic turning point in the balance of Confederation.

The province still faces plenty of problems, with public debt improved but not solved. Many public sector professionals feel underpaid and overworked. Rural poverty and depopulation are still critical, as large swaths of the fishery are terminally ill. The challenges of distance and isolation make it hard for the province's budding entrepreneurs to push out from the Rock.

But Mr. Williams showed the province can reverse its doormat destiny. Critics may say he coasted on his good fortune as premier when oil hit $140 a barrel and then during the strong rebound from the depths of 2009. But every rich resources economy is inherently lucky. It is what you do with that luck.

The example of what not to do is Alberta, which has failed to capitalize on its boom cycles to build a sovereign wealth fund of much scale. Ontario seems destined to fritter away its resource, industrial and location strengths. There are lessons for Newfoundland, as it makes a dent in its public finances and thinks about life beyond penury.

Clearly the national game is about to change. The resource players in the Canadian West worry that the seemingly endless stream of able workers from the Rock will soon end, as these folks stay home to work in local projects.

When the workers do come home, the test will be how governments deal with talent issues for the next 10 to 20 years. Resources are a fleeting foundation, while training in the industries of tomorrow could move the province to a permanent "have" status.

Whatever happens, the new premier will not need to be a chip off the old Rock. Mr. Williams felt he had to be an insurrectionist, with a take-no-prisoners style that earned him the title "Danny Chavez."

His successor can afford to be more conciliatory to Ottawa, to other provinces and to Big Oil. We could see a mature, confident Newfoundland and Labrador, a province that is not just a fighter but a leader - and that, indeed, would be a sight to behold.

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