Canada’s natural resource endowment is unmatched. We are the world’s largest exporter of forest products, the third largest exporter of natural gas and the fourth largest exporter of agriculture and agri-food. Our country has the world’s third largest oil reserves and is a competitive producer of metals and minerals.
There’s a responsibility with this incredible inheritance to help meet demand for natural resources worldwide. Emerging economies will drive energy demand growth by 56 percent by 2040, and food production growth by 70 percent by 2050. Also, demand for metals will rise five times over the next forty years.
Acting as a resource basket sets Canada up for a prosperous future by providing good jobs across the country. The natural resource sectors already directly, and indirectly, support 1.8 million jobs across the country. Resource industries currently provide $30 billion annually to government revenues, equal to approximately half of all spending on hospitals in Canada in 2013. Health costs will rise, but so can the resource sector’s contribution to the final tab. With the right policies in place this figure can grow even higher.
Despite the importance of natural resources sectors, many misperceptions remain. Canada’s resource industries are no longer simply hewers of wood and drawers of water. Modern resource industries are technologically sophisticated. Their activities drive economic growth and support Canadian families in cities and rural areas alike.
What’s holding Canada back is a lack of adequate transportation infrastructure to get our goods to new high growth markets. Simply put, we need more rail, ports and pipelines to be able to get Canadian goods to overseas markets that are clamoring for them.
The impact of inadequate infrastructure is felt across the country. This winter, 400 workers were almost laid off from a steel mill in Regina because there weren’t enough rail cars to ship their product. Canadian oil producers often face depressed prices for their product because of transportation bottlenecks in the U.S. and a lack of access to more valuable world markets. In 2012, this cost the Canadian economy as much as $50 million a day. And Canadian mining products are sometimes forced to access the sea through U.S. ports because the Canadian facilities lack needed infrastructure.
Some people think Canada’s natural resources are like a winning lottery ticket — a stroke of good luck that has little to do with science and innovation. The truth is that while nature gave us trees, ores and mineral deposits, land and animals, it is innovation and enterprise that transform them into the products that earn us our prosperity. These are highly technically sophisticated sectors.
Take for example, the Canadian forest products sector which is on the leading edge of developing nanocrystalline cellulose, an advanced material derived from wood pulp that has the potential to be used in everything from electronics to car parts. Another examples is miners who now use sophisticated computer software to create 3D models of ore deposits and can drill to a precise point at over 800m depth. Production methods like aquiculture would not even be possible without understanding the complex sciences of biology and ecology.
Most of us may not see how that wealth spreads across the country, benefitting communities far from any mine, farmer’s field or oil well. There isn’t a single mine in Toronto, but the Toronto Stock Exchange is becoming the world’s mining finance and professional services capital. In 2012, 60 per cent of the issuers on the Toronto Stock Exchange and TSX Venture Exchange belonged to the mining, energy, forest product or clean technology sectors.
Ontario also received $3.5 billion in economic benefits from oil and gas development in the West, while that same industry was creating 10,000 direct and indirect jobs in Quebec.
In the next two years, Canada will consider a number of proposals to build the infrastructure needed to get Canada’s natural resources to market.
None of these investments – ports, pipelines, roads, railways – is free of impacts. But a sophisticated nation like Canada can manage these challenges and can move any product safely, if our businesses and governments are sufficiently motivated and vigilant.
Humanity must become more efficient in its use of resources, and we must find substitutes for products and processes that harm our natural world. But as we improve, we still need food to eat, energy to power our homes and materials to make the products we need.
If we act decisively, we can maintain and build that growth. The Canadian Chamber of Commerce is advancing a pan-sectorial partnership: the Partnership for Resource Trade to engage Canadians in a public debate about natural resources. This partnership will reinforce pride in Canada’s natural resources, push for favourable policies for resource growth and advocate for adequate transportation infrastructure to get our goods to new high growth markets.
In Sudbury, a city known for its mining, there should be no shortage of voices advancing the importance of natural resources. With opportunities such as the Ring of Fire, we need to take all the necessary steps to unlock the potential of natural resource development.
We hope that you will join the discussion and give your support to the Partnership for Resource Trade which aims to create a prosperous future for Canadian business, the Canadian economy as well as all Canadians. For more information, please visit http://PowerofCanada.ca/speak-up or follow on Twitter at @PowerofCanada.
By Debbi M Nicholson, President & CEO, Greater Sudbury Chamber of Commerce