
Forestry can keep growing
Published Thursday August 28th, 2008


Natural Resources Minister Donald Arseneault and Premier Shawn Graham have been given a series of expert recommendations on renewing the forest industry. Will they be able to lead this province out of the wilderness?
Forestry is one of the oldest industries in the province. Its growth has been hindered recently by changes in international markets. The consensus, though, is upbeat: New Brunswick's forest industry can rebound, provided government makes good policy decisions.
The motivation to do so could not be much greater. The forest industry is the largest employment sector in the province, equally important to northern and southern New Brunswick and in urban and rural areas.
The task force reports released Wednesday should give government a sense of purpose and direction. The authors are experts in their fields, and their conclusions point the way to a general renewal of the forest sector within a few years. For the industry to make the most of this opportunity, the provincial government must create a more conducive business environment.
New Brunswick's forest companies have demonstrated a commitment to be competitive and pursue new economic opportunities. But a number of factors are holding the industry back. To make the industry a growth sector again, public policy needs to be tuned up in four key areas:
€¢Changing mill production is extremely capital intensive. Creating general investment tax credits would allow companies to invest in improvements as rapidly as possible.
€¢Energy is the greatest recurring cost forest companies pay. Policies which make it easier for mills to generate power from biomass and other 'green' technologies would make the industry more competitive and help meet NB Power's renewable energy targets.
€¢Growth depends on managing woodlands for a sustainable fibre supply. Wood production goals and harvesting plans need to be transparent, based on sound science, and increase the supply of fibre.
€¢Export markets must also be expanded. The U.S. remains New Brunswick's best target market - and producers need to sell the value of their products south of the border.
Analysts have described the recent industry downturn as a 'perfect storm' of market conditions. The message New Brunswickers received this week is that the storm is blowing out. Government must develop a strategy that will help the industry get back on course.




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