Chapter Eleven: Shifting Foundations: a Political History of Canadian Mineral Policy

Seismic Shifts or Minor Tremors in the Status Quo?

Download 143 Kb.
Size143 Kb.
1   2   3   4   5   6   7   8   9   10   11

Seismic Shifts or Minor Tremors in the Status Quo?

The past few decades has raised questions about whether the mineral industry could be classified as a sunset industry with Canada moving into a post-staples, knowledge based economy. As the Sudbury example would suggest, it is possible for an economy to diversify based on its resource-based strengths. The mineral industry, much like other enterprises in Canada has adapted to competitive challenges with many technological innovations contributing to a so-called knowledge economy. An examination of its production values suggests that they remain very strong and Canada continues to be a world leader in mineral exports and exploration. (Natural Resources Canada, Minerals and Metals Sector, 2001). Canada exports 80% of its mineral production which account for 13% of the country’s total export earnings. Canada is the base for more mining companies than any other country in the world with its largest city, Toronto, touted as the mine-financing capital of the world. (Ontario Ministry of Northern Development and Mines, 2004).

Michael Howlett suggests that Canada has diversified by experiencing a growth in the tertiary sector, industrial expansion in regional centres, significant growth of metropolitan regions and a decline in resource-based communities (Howlett, 2003: 58).

Howlett poses two possibilities. The first is that Canada will remain “stuck in a mature staples” trap and will continue “to reinforce existing economic policy measures promoting increased resource extraction” (Howlett, 2003: 59). The second would see the diversification of the economy based on the traditional staples industries with value-added products including environmentally-related services moving toward a post-staples economy (Howlett, 2003: 59). With respect to the mineral industry, we are seeing elements of both trends developing.

Many examples can be found of government policies that continue to subsidize industry and support policies that continue promote primary resource extraction. For example, the Canadian mineral exploration sector led the world in exploration expenditures in 2002 and 2003. One singularly important reason for this is that the industry received the benefits of national a flow-through share program, also referred to as “super flow-through”. These tax incentives have been enhanced by provincial tax incentives in British Columbia, Saskatchewan, Manitoba, Ontario and Quebec. In total over $525 million of these shares were raised for mineral exploration in one year (Natural Resources Canada. Minerals and Metals Sector, 2004).
These kinds of government incentives signal that governments are continuing to actively promote policy measures in order to reinforce the economic position of extractive, industries. This reality runs counter to a post-staples, ecosystems-based argument that suggests that post-industrial economies often have a competitive advantage over staples-dependent economies. These ‘new’ economies are competitive, it is argued, because government uses taxation incentives and regulatory measures to develop goods and services that do not rely as much on the costly production of raw materials and substantial energy inputs.(Dale, 2001). Clearly, the current Canadian taxation and regulatory environment continues to promote staples-based development.
In Canada, we are also seeing signs of the emergence of a new, staples economy. These developments reflect Howlett’s second more optimistic alternative suggested above; that is, the Canadian economy will continue to diversify supported by its traditional resource industries. Recent Natural Resources Canada documents identifying diversification and shifts in the industry suggest that it is undergoing “profound structural change.” Economic diversification of the minerals industry has been growing in terms of downstream, value-added processes. Employment in mining itself has declined, in part because of the substitution of labour through technological developments, but it is growing in other areas such as materials handling, specifically recycling which is becoming an important source of metals in many regions (Natural Resources Canada. Minerals and Metals Sector, 2001: 9).
Canadians are large investors in exploration (accounting for 30% of all projects throughout the world) and mining projects overseas (approximately 6000). (Natural Resources Canada. Minerals and Metals Sector, 2001: 17) International investment, in turn, generates a demand for Canadian mining, equipments, services and expertise—all of which contribute to the secondary and tertiary economic sectors. Canadian innovations in the mineral industry, its global leadership in the production of minerals, research and development and environmental technologies, mean that there are promising trends in its ability to diversify. The most notable example of these developments can be found in the example of Sudbury which has diversified its economy based on mining-related spin-off businesses associated with equipment, robotics and technology.
The shift to a knowledge economy has not directed attention away from the mineral industry. It, along with other economic enterprises, has been using information technology to foster productivity and creating value-added goods and services. The federal government has been encouraging this direction suggesting that investment in such things as fuel cells, batteries, sensors, lightweight and structural materials which rely on mineral production will provide new opportunities for the industry. (Natural Resources Canada. Minerals and Metals Sector, 2001: 16). Continuing public concerns about the ongoing adverse biophysical and socio-economic impacts of Canadian mining operations in Canada and around the world are fuelled by reports of failure of tailings dams contaminating watersheds, displaced communities and workers. or unwanted resource development. One commentator has this to say about the new, post-Fordist environment:
About the empowerment of workers, households, and communities, it is not. About the creation of more participative, skilled labour processes, it is, at best, tangential. Rather, the emerging economy is, first and foremost, about doing more with less and for less….Thus, despite local variations, downsizing, the expansion of work areas, and the addition of new tasks to old jobs were the real trademarks of the changes that were besetting the mining industries. (Russell, 1999: 199).
That said, in Canada, we are seeing some pockets of change in the way traditional resource activities are carried out. In some areas, institutional and individual learning is taking place in new consultative forums as people bring a diverse suite of resource values to the negotiating table. In such forums, positions must be justified on the bases of their contribution to the broader public interests that now includes ecological and community sustainability. One analyst, Robert Gibson, suggests that one can find evidence that changes may be taking place in the mineral development process—changes that distribute wealth and proceed in a more economically and ecologically sustainable manner. The example that Gibson offers is that of the Voisey’s Bay mine development, a huge nickel-copper-cobalt deposit in Labrador owned by a subsidiary of nickel giant INCO Ltd. In June 2002, the Aboriginal peoples in the area, the Innu and the Inuit, agreed to the ratification of an agreement to open the mine following an environmental assessment process and negotiations with the major stakeholders, which in this case included affected communities, governments and industry. Gibson suggests that the agreements were remarkable given the vast difference in cultures, priorities and interests involved and the fact that the agreement was able to encompass and integrate biophysical and socio-economic considerations.(Gibson, 2002). He notes that the reasons for success, at least up until this point of the development, can be attributed to the substantial power given to the indigenous people in the decision-making processes, the fact that all the main players had an important level of influence, and that the planning and assessment processes called for an integrated, lifecycle, approach to ecological, socio-cultural and economic aspects of the project. Notably, the agreements emphasised long-term benefits, and requirements that the evaluative and decision-making process be continuing and adaptive through the life of the project. Although this was a single case, decision-making processes are frequently built on previous experiences and lessons learned. The Voisey’s Bay case sets some standards for a new approach to mineral development that others might follow.

Share with your friends:
1   2   3   4   5   6   7   8   9   10   11

The database is protected by copyright © 2020
send message

    Main page