TERRACE STANDARD

~ Business REVIEW

Massive forestry rule shift
to bring opportunity, pain

. By JEFF NAGEL
B.C, CAN no longer afford
the luxury of rigging its
forest industry to prop up
jobs or deliver social and
political goals.

That's forest minister
Mike de Jong’s blunt ex-
planation of the need for
forestry reforms thal he
calls the most sweeping in
half a century.

There will be anxiety,
uncerlainty and pain, de
Jong warned an audience
here March I.

“Ie will take collective
courage on our part to ad-
dress “some of this stuff,”
he said. “But the price of
doing nothing is far too
great,”

Increasing global com-
pelition is hurtling toward
B.C. and we must prepare,
he said.

“Qur customers have a
choice,” he said. “Russia
hasn't even cranked up
yel, We're competing with
those people.”

“Competitiveness is an
issue like it has never
been before.”

Too often, he said, B.C.
made forest policy deci-
sions because they “made
political sense because an
election was coming but
no economic sense.” °

The changes are rooted
in the desire desire to ar-
rive at a more market-
based stumpage and tenure
system to bullet-proof the
B.C, system against Amer-
ican accusations that pro-
ducers here are subsidized.

Some argue reforms
should wait for a deal with
the U.S. on softwood jum-
ber.

“T don’t think we can
wait,” de Jong said.
“We've got made in “B.C.
problems and we'd better
find some made in B.C.

solutions.”

A $275 million Forest
Transformation Fund is
being set up to deal with
the fallout from the re-
forms.

De Jong said the forest
reforms should be intro-
duced by -the end of
March.

Here's a look at the
planned changes: ,

Right log to
the right mill

Rules called
“appurtenancy” that re-
quire logs from certain li-
cences be processed al a
specific mill will be elimi-
nated,

Critics warn this will
mean closures of some
mills.

But De Jong says it will
enable logs to flow where
they're best used. He says
that rule covered only four
per cent of timber any way.

Log It or lose it

Right now, if a compa-
ny fails to cut at least 90
per cent of its annual cut
over five years, the pro-
vince can hand the unused
timber over to other users.
And it can also penalize
the company by reducing
its annual cut in future
years,

De Jong says he'll keep
the first provision - take

FOREST MINISTER Mike de Jong laid it on the line

to a local audience recently in Terrace when he
spelled out huge changes in forest policy. The old
way of tying wood to a mill is to disappear, he said.

be able to freely sell their
licences to others, even
split off portions of their li-
cence to sell.

Critics have argued that
essentially privatizes B.C.

timber and in particular:

may lead to companies
chopping off less desirable
areas of timber so as to log
only the more profitable
areas.

Kitimat-Stikine regional
district director Les Wat-
mough told de Jong it will
mean “real-estating” of
timber licences — compa-
nies will make money not
by logging or milling but
by buying and selling li-

+

cences.
“They will be making
money on our Crown
resources.”
De Jong said the gov-
ernment shouldn't. be the

‘only. entity allowed to sell

timber.

“You're saying that the
flow of fibre will be micro-
managed by the Crown
from Victoria,” he said. “‘T
disagree.”

De Jong says the
change will create more
activity and greater use of
wood than forever shack-
ling it to one owner.

“You sell when you
want to and you sell when

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Processing rules

set to change

De Jong says he'll eli-
minate rules that force a
firm that logs wood to pro-
cess it somewhere in B.C.

He says that will allow
industry players to decide
if they want to be just log-
gers or just processors ra-
ther than being forced to
be both.

“There are people in
this province who are good
stewards and good
loggers," he said. “Let
them log. They don’t know
a thing about operating a
sawmill But we force them
to operate a sawmill. I
think that's stupid.”

Log exports
limited

:Log exports won't be
expanded — one of the key
demands American nego-
tialors are pursuing as part
of a softwood lumber deal,

“The restrictions that
exist on the export of logs
from Crown land will re-
main in place,” de Jong
pledged.

“What [ am saying is
within British Columbia
there is going to be a freer
flow of fibre,” he added.
“Change will happen.”

Cont'd Page B4

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The Terrace Standard, Wednesday, March 19, 2003 - B3

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don’t use and offer it to..
others, :
But further punitive pe- _
nalties will no longer. be
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“It is nonsensical - that.
we would force anyone to
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tivity,” he said of penal-
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ber in perpetuity.
“It is there to be used,”

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