Forestry sector holds promise for Indigenous communities

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This article was published 23/03/2020 (2042 days ago), so information in it may no longer be current.

WHEN you think of Indigenous engagement in the natural resource economy, you usually think of opportunities in the oil and gas industry or in mining. However, First Nations are increasingly getting involved in commercial forestry.

Certain provinces, including Manitoba, have a sizable forest industry that plays a substantial role in the economy.

In March 2019, the province signed a two-year forestry management option licence with four First Nations on the east side of Lake Winnipeg to examine the possibility of setting up Indigenous-led commercial forestry operations. The agreement involves Black River First Nation, Brokenhead Ojibway Nation, Hollow Water First Nation and Sagkeeng First Nation.

Due to Canada’s unique forest tenure system, governments can play a big role in allowing First Nations to take advantage of these opportunities, all without any direct subsidies or interference in the free market. Ottawa can encourage the provinces such as Manitoba to adopt policies encouraging Indigenous access to the forests.

With the right policy mix and increased access to capital, more Indigenous access to the forest economy could greatly enhance Indigenous economic independence. In fact, there are some First Nations in B.C. whose forest business revenues exceed their federal transfers.

Provincial governments could expand the amount of forest tenure available to Indigenous communities so First Nations can take better advantage of the high-wage forest economy. Governments can help First Nations take advantage of business opportunities in the forest sector by expanding access to capital.

As countries with substantial forests go, Canada has a large percentage of its forests under public ownership. The Canadian Forest Service says that about 94 per cent of Canada’s 402 million hectares of forest land are publicly owned — 77 per cent provincially and 16 per cent federally. Most of the timber cut on these lands is harvested by private-sector companies that hold Crown forest tenures. Although only six per cent of the country’s forests are privately held, they contribute significantly to the wood products sector. In Manitoba, most of the forest is provincially held Crown land. New Brunswick, Nova Scotia and Prince Edward Island hold their lands largely in private tenure.

First Nations are uniquely situated to take advantage of these opportunities. After all, the Forest Products Association of Canada says 80 per cent of Indigenous communities are in wooded areas.

According to Statistics Canada, the average income for members of First Nations involved in the forest sector is about 15 per cent higher than the median for all economic sectors.

The National Aboriginal Forestry Association estimates that 1,200 to 1,400 Indigenous-owned companies are involved in the forestry sector. Many of these firms carry out contracts for companies in the sector, but Indigenous communities themselves are becoming much more assertive in the sector.

For example, in January of last year, 13 First Nations in Saskatchewan came together to form an alliance and leverage their financial resources. According to the Prince Albert Herald, together the 13 communities represent over half of the allocated active wood supply in Saskatchewan. This alliance will create business opportunities and good jobs for these communities.

The National Aboriginal Forestry Association has said that Indigenous-held tenure now makes up more than 10.5 per cent of Canada’s total wood supply, whereas in the 1980s, it was only about 0.05 per cent.

Indigenous communities, and indeed all forest-dependent communities across Canada, are living in a new economic reality. Between 2000 and the present, there has been a change in the demand for forest products in the global marketplace.

The demand for paper products — particularly newsprint — has declined and demand for lumber has increased. Fifty-eight of Canada’s 141 pulp and paper mills have closed since 2000. At the end of January, a paper mill near Pictou, N.S., closed, creating huge ripples throughout the regional economy.

Indigenous communities — given their proximity to wooded areas — are uniquely situated to take advantage of commercial opportunities in the forest economy. The federal and the provincial governments need to work with First Nations to ensure they have fair access to forest tenure and opportunities for partnerships. The alternative is continued poverty and dependence on government programs, which is in no one’s interests.

Joseph Quesnel is a research associate with the Frontier Centre for Public Policy.

— Troy Media