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Is there a light at the end of our troubled forest-sector tunnel? And if there is, is it just another bad-news train barreling down at us, or is it a real sign of an economic recovery. Who knows? One thing for sure, although our region has been blessed with a wonderful resource, regrettably it’s been squandered and its high time we acknowledged the necessity of using our brains instead of a chainsaw and a stud mill to grow our economy. I want to begin by saying for much of this column I’m indebted to the December edition of the Globe and Mail Report on Business and an article on the Finnish forest industry. However, before I get to Finland, I have to repeat an editorial question I asked last spring, which is, why the hell are we going full steam ahead to produce a lumber product no one wants? We keep banging our heads against the wall making lumber for the American housing market in the futile hope that if we if increase the tempo, the pain will go away. What an absurd policy. We’ve had softwood countervail battles with the U.S. since the 19th century. In early 2006, Forbes magazine - the pre-eminent U.S. business publication - correctly predicted a downturn in the American housing market, yet government policy and forest-industry strategy was simply to churn out more U.S.-bound building products. It’s a classic example of putting all of our eggs in one basket, which sadly to say, is a basket that’s just been dropped off a cliff. Sure the B.C. lumber industry is modern and efficient. However, it’s like making the world’s best buggy whips; nice product, but where’s the market? Now to Finland, which unlike Canada is totally dependent on its forests. In fact, trees are its only natural resource. Consequently, the best use of wood is absolutely critical to the national economy. B.C. producers griping about currency parity with the U.S. should also note Finland has the same problem with its currency - the euro - which is also strengthening against the U.S. dollar. Yet the Finnish forest sector is strong and accounts for 20 per cent of national exports, compared to 10 per cent in Canada. The Globe story went on to say the Finnish strategy was not to think of trees as a cheap fodder for newsprint or lumber, but rather as the raw material for value-added biofuels and pharmaceuticals. This is where I cut to the chase. Where Finland excels is in its research and development policies. In Finland, 16 out of every 1,000 employees are engaged in research. The Finnish ministry of trade does not give business subsidies; rather, it funds education. In Finland, 70 per cent of research and development funding is provided by industry; the remaining 30 per cent by government. But, to qualify for a research-and-development grant, industry must cluster with related companies so all benefit. Here’s a close-to-home example and remarkable gee-whiz fact from Finland that really nails the research advantage. The Finnish city of Jyvaskyla - population 88,000, about the same size as Prince George - has several post-secondary institutions and 36,000 students. By way of comparison, Prince George probably leads the province on a student per-capita basis with about 7,000 at CNC and UNBC, but we are nowhere near the Finnish student ratio level. I should also point out Finland has no tuition fees for full-time students. Can a country benefit from strong
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research and education policies? Absolutely. The Finnish manufacturer Metso is one of the three largest paper machine manufacturing companies in the world. Do you know of any B.C. or Canadian companies making paper machines? No you don’t; there are none. The world’s largest producer of paper-making chemicals is also Finnish. What we need most in Prince George, and indeed the province, is not political promises but intellectual capital. The future of our economy lies not in government favours or in the corporate boardrooms. Rather, it is in research labs and the classrooms. The world’s largest forestry consulting firm is Poyry, a Finnish company. Nokia, the Finnish cellphone giant, once made rubber boots. And that’s where the B.C. forest industry is today, still slogging along in the rubber-boot league looking for a handout. Clearly, it’ time to rethink our thinking. Bruce Strachan is a former B.C. cabinet minister and Prince George city councillor. His column appears Thursdays. E-mail:
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On a visit to New Zealand in the 80's, we were lucky enough to meet a family who lived in an "Instant Town" like Mackenzie or Tumbler Ridge. What fascinated my husband and I was how they treated their trees. Down there it is called "Tree Farms" and we were blown away by the fact that their "logging roads" were paved! I realize that the climate is a lot different here, but I think that we should get off our high horses and look at what other countries are doing, as Bruce suggests.