As the economy stagnates, BC needs a clear plan for pushing towards a better future, and resource industries must be part of that.
On Tuesday morning, leaders and representatives from several British Columbia business groups gathered for a press conference to issue a warning about the state of the province. The message was clear, the cost of living and stagnating economy needed to be addressed with a clear vision and growth-oriented policies.
The groups who attended included the BC Chamber of Commerce, the Council of Forest Industries, the Mining Association of BC (MABC), and the Independent Contractors and Business Association.
Those representing forestry and mining especially were frank in their warnings that labour shortages, excessive regulations, and rising costs are driving BC deeper into stagnation.
If BC is to move forward towards an economy that benefits all people in every part of this province, then the resource sector will need to be at the front of the line.
At-least one out of every three dollars in the province’s GDP is tied up in real estate, and that sector alone cannot effectively sustain the economy. Forestry and critical mineral sectors should be pillars of growth in Canada, but are being left to languish due to the regulatory decisions that have hamstrung both.
Natural resources are not antiquated, and to this day, are among the best ways to get money moving across Canada. Since being completed in the spring, the expansion of the Trans Mountain (TMX) pipeline has been a great success thus far, showcasing the abilities of natural resources to grow the national economy.
Many of the challenges currently styming forestry and critical minerals have not sprang up due to market forces alone. Government-enforced policy plays a major role.
In the past decade, deferrals and suspensions on harvesting have prompted many sawmills to close along with the jobs in forestry-reliant communities. Canfor has been shuttering mills across the province for years, and thousands of jobs have been lost.
"The forestry sector says B.C. has sufficient timber available for harvest, but the actual harvest level has declined dramatically. In 2023, it was 42% lower than the allowable cut — a level not seen since the 1960s," wrote Resources Works' own Margareta Dovgal earlier this year.
Mining and critical minerals face another similar set of hurdles. BC has a wealth of minerals that are essential for the energy transition, especially lithium and cobalt. Unfortunately, it takes 17 years for a mine to be fully-built and operational due to a bloated regulatory process that deters investment from BC and the rest of Canada.
The demand for critical minerals is through the roof with the global market for EVs and other products with modern technologies soaring.
At the Tuesday press conference, MABC President Michael Goehring stated that 16 proposed critical mineral mines in BC could draw $36 billion in investment, and position B.C. as a global leader in the green economy.
In the oil and gas sector, the TMX pipeline has demonstrated the huge potential for growth in the natural resource sector. Despite years of delays and huge cost overruns, the pipeline’s expansion is complete, and according to the Bank of Canada (BoC), added 0.25 percentage points to Canada’s second-quarter growth, more than all of BC combined.
Like it or not, Canada is an oil and gas exporting country, and BC has huge deposits of natural gas. Three liquified natural gas (LNG) facilities are being developed along the BC coast, potentially making the province into a major player if it can build on that foundation.
Despite the great potential of resources, the BC real estate sector has expanded far more rapidly, with at-least 30 percent of the provincial GDP tied to it. This dependence is unsustainable, and more importantly, unproductive.
BC was once reliant on natural resources in the heyday of the post-war boom.
It does not need to be fully reliant on them again, as a diversified economy is what the province should aim for but there is no reason why sectors like forestry, mining, and oil and gas must be restrained and not among the most important contributors to the economy.
When it comes to emerging from stagnation, BC needs all hands on deck.