NNSL (Mar 25/98) - Strategic alliance. It's a term often used to achieve economic objectives. For David Connelly, co-chair of Yellowknife's diamond industry development task force, capturing secondary diamond industries is a strategic objective.

"I believe one of the costs we should impose upon any outside company coming here is that they must enter a strategic alliance with local business people, local groups and aboriginal development corporations," said Connelly, who's also president of the NWT Chamber of Commerce.

At the Prospectors and Developers Association Conference earlier this month in Toronto, Connelly drew a line in the snow to protect and secure Northern jobs in the secondary diamond industries.

In his presentation he proposed a number of strategic opportunities.

A Northern ally could construct a building and lease it back to the diamond companies, he said.

A Northern ally could recruit services for the diamond mines such as screening diamond sorters or cutters and polishers.

Another opportunity could be a foreign company providing training and employment to Northerners or a foreign ally subcontracting to Northern companies to do such things as security, diamond fingerprinting or polishing wheel repair or transportation.

There's no assurance yet that secondary industries will come North even though BHP's Ekati mine goes into production this fall. The territorial government said it will happen and the city has asked staff to prepare a paper on what benefits the city can provide the industry.

The Department of Indian and Northern Development is least favorable to the idea, said Connelly.

"Diamonds may be able to do for the North in the first half of the 21st century what gold did for the North in last half of the 20th century," said Connelly.

Besides alliances, Connelly touched on business incubators in his presentation at the Toronto conference.

"Business incubators nurture start-up businesses and provide comprehensive support structures until they can stand on their own," said Connelly.

There are currently 600 business incubators in North America. Studies have shown that the success rate is 80 per cent with a return on public investment averages be $4.96 for every dollar invested, he said.