The trillions of mountain pine beetles eating their way through British Columbia's forests could also gnaw away a significant chunk of the province's economy, according to a new report commissioned by the Business Council of B.C.
The current beetle epidemic is expected to kill 80 per cent of the province's pine, leaving in its wake enormous tracts of wood that can't profitably be turned into lumber and a dramatically shrunken forest industry. Ultimately, the report found, that could lead to a 20- to 40-per-cent reduction in the province's interior forest industry.
As a result, B.C.'s economic base could contract between 3.8 per cent and 7.6 per cent, enough that the report's author, Don Wright, former B.C. deputy minister of forests, said one of the country's rosiest economies could be at risk of a future recession.
"If we don't make the right choices over the next few years, that could happen," Wright said.
But, he said, the province can blunt the economic impact if it is smart about the way it allocates cutting rights and manages its trees.
"If we can extend the [useful] life of the dead pine and if we make decisions around the annual allowable cut that see a gradual reduction as opposed to falling off the cliff, then I think it's going to come at a pace that the provincial economy can adjust to," Wright said.
Lower stumpage rates, better innovation and more tree-fuelled bio-energy can all help to sustain the province and its forest-dependent communities, he said. Many of the Interior and northern towns in B.C. owe more than three-quarters of their private-sector economic base to the forest industry.
Still, B.C. Forests Minister Rich Coleman is optimistic. He called Wright's forecast impact "a little high" and said the pine beetle is leading to "some pretty excellent opportunities" -- key among them bio-energy, which his government sees as a critical new economic frontier.
"It's not going to be easy, but hard work will get us through this," he said.
Still, economists say that while a provincial recession is unlikely given the massive amounts of mining and oil-and-gas investment currently pouring in, the prospects for B.C. after the 2010 Games are worrisome.
"If you look forward to the period hitting 2015, there are a lot of us saying we're a little uneasy about what could happen to the provincial economy," said Dave Park, the economist emeritus with the Vancouver Board of Trade. "At that time, the pine beetle impact will really be being felt and there's a lack of certainty around what the really positive growth factors will be in the economy at that time."The Vancouver Sun
