The twinned announcements last week of a new provincial forestry strategy and a massive series of plant upgrades at J.D. Irving (JDI) Limited’s flagship pulp mill is a textbook example of how government and industry should execute a minuet – with slow, metered steps calibrated to the economic rhythm of the times.
Of course, the dance Premier David Alward’s Progressive Conservatives and JDI are presently performing to generally enthusiastic and receptive audiences – who perceive the dawn of a new day for, arguably, the province’s most important commercial sector – is not without its critics.
Some conservationists in the province are outraged that the Department of Natural Resources’ new strategy boosts the size of the total allowable softwood harvest on Crown land to four million cubic feet a year (about a 20 per cent increase from the current allocation).
“I’m shocked,” Graham Forbes, a forestry professor at the University of New Brunswick, told the CBC last week following the government announcement. “The reduction of the amount of protected land to 23 per cent (from 28 per cent) is not what we could call sustainable forest management. It’s an abject fail. It’s not sustainable.”
Even some industry players have cast a slightly jaundiced eye over the plan.
“We are guardedly optimistic,” Mike O’Blenis, vice-president of the New Brunswick Forest Products Association, told the Telegraph-Journal last week. He had been hoping – vainly, it’s now clear – for an increase in the hardwood allocation. Still, he said, “the devil is in the details. . .There is a lot of detail that has to be worked through with government and with stakeholders to put this plan into place and it is going to take some time for all that detail to come out.”
Still, what’s clear is that JDI’s announced $450-million modernization program (part of a bigger $513-million investment program at the company) for its west Saint John pulp mill will crate hundreds of new and badly needed jobs in the province over the next two years.
What’s also indisputable is that the upgrades (all of them privately financed) are tied directly to the provincial government’s decision to increase the amount of wood available to commercial harvesting. This pledge, according to Jim Irving, co-CEO of JDI, is crucial because, as he said at the announcement, “our ability to to invest and grow jobs depends on the certainty of the competitive wood supply. . .Premier, you’ve got our commitment, and I can tell you the JDI team will deliver.”
This is no mean feat at a time when governments across the western world appear either unable or unwilling to leverage the public resources they control to generate durable, measurable and responsible regional industrial benefits for everyone.
According to the New Brunswick Forest Products Association’s web site, “forestry has been the cornerstone of the New Brunswick economy for decades. More than 20,000 families are supported by the. . .sector. With more than 11,600 people directly working in forestry related jobs, our people produce 30 per cent of total manufacturing output (in) the province.”
Other facts, courtesy of the Association, include the $1 billion in salaries forest sector employees earned in 2010. Moreover, “as of 2010, the sector directly contributed just over five percent to the provincial GDP. At 5.1 per cent, that makes the forest products industry in New Brunswick more important to the provincial economy than in all other provinces in Canada. Total direct GDP in 2010 for the forest products sector was an estimated $1.4 billion in current dollars. The industry has significant indirect GDP multipliers of between 0.5 and more than 1.0 depending on the area of activity. Including direct and indirect effects, the GDP in 2010 was between $2.2 billion and $2.5 billion.”
And yet, for all of this, the sector has endured exceptionally tough years. Over the past decade, the number of milling operations in the province has dropped by 60 per cent. Since 2008, the number of jobs have dropped by 50 per cent.
Apart from the predictable criticisms about the relationships between governments and industries – that they either go too far or not far enough – last week’s twinned announcements demonstrates that in New Brunswick, of all places, government and industry can face the music together as productive dance partners.