Pulp and Paper Canada

NB government unveils $250M plan

December 27, 2005  By Pulp & Paper Canada

A five-year assistance package worth $250 million is coming to the New Brunswick forestry industry.

A five-year assistance package worth $250 million is coming to the New Brunswick forestry industry.

“This summer I asked Business New Brunswick Minister Peter Mesheau to lead a ministerial task force to study the current status of the forest products industry in the province, and provide recommendations to government on a plan to build and sustain the industry into the future,” said Premier Bernard Lord of the package.


“Today’s commitment is an investment in diversification, productivity improvements, value-added products and better utilization of our forestry resources,” he continued. “The government is committed to the future of this industry.”

The package will target the recent market challenges that have spurred tremendous insecurity in the industry, while trying to secure jobs for workers. The initiatives laid out by the plan build on work the government has already announced to assist the forestry sector.

“Recently, the government was pleased to provide A.V. Nackawic with financial assistance in the amount of $67 million for the purchase, retrofit and expansion of the mill,” Lord said. “In 2001, a freeze and a phased-in approach to increases on the property tax assessments of heavy industrial properties was announced. A comprehensive review of property tax assessments for heavy industrial properties was also conducted to ensure the province’s property tax regime did not act as a barrier to job creation and economic growth in New Brunswick.”

The Premier did confirm that the range of issues the provincial government can address is limited, due to rising fossil fuel costs, exchange rates, interest rates, global labour rate differentials, commodity prices and international trade barriers, issues it has cited as being beyond its influence.

Included in the plan is a government commitment that the annual allowable cut won’t be scaled back in the 2007-12 forest management plans, as a result of new or enhanced non-timber objectives. The Department of Natural Resources will reduce 2005-06 pulpwood royalty rates by 25% to reflect current market conditions, resulting in savings of $3.2 million for the industry. The department will also release by April 2006 a biomass policy that will set out the opportunities and operational rules for harvesting biomass from crown land. At the same time, the department will determine the volume of lowest-quality pulpwood that is long-term surplus to market demand that should be made available as biomass, and establish the appropriate price given market value.

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