I had a lively chat a few years ago when Molson announced they would be putting a plant in Moncton (with a large grant from the province). The person I was discussing this with was insistent that it wasn’t economic development because the plant was primarily going to service the local market (Maritime) and would end up just taking market share from other local producers (see story about the firm’s growing market share here).
Import substitution is an important economic development concept. I don’t believe we should put up barriers to protect local producers, but in a free market context if a firm (like Molson) was manufacturing product elsewhere and shipping it into the Maritimes decides to move the production here that is indeed incremental economic activity and therefore economic development. If they increase their market share here and reduce the market share of other local producers that is not strictly speaking economic development because they are just taking market share from other producers (not new economic activity).
In fact, I would like to see import substitution explored more fully as an economic development driver. If there is a captive market in the Maritimes for a product or service – we should be encouraging companies to fill that market by setting up here. An example might be Walmart’s distribution activities in the Maritimes. Right now all their product is shipped in from warehouses elsewhere. If that distribution activity was done locally in the Maritimes it would add incremental economic activity (say 150 good paying jobs) here.