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David Campbell

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I am happy to report that at least on my blog and in my discussions about the proposed NB Power sale to Hydro-Quebec, we do seem to be moving beyond the populist rhetoric and on to what I think are the substantive issues worthy of debate. I realize there is a political debate running parallel to the fact-based debate, but I am giving the big 'P' politics of this issue a wide berth.

On the fact-based side of the discussion, one of the interesting sub-debates surrounding the proposed NB Power sale to Hydro-Quebec has been the belief by some that the main reason the government is pursuing it is to prop up what are being referred to as 'sunset' industries. I have heard this term used widely and believe that it is being misapplied in this case. A sunset industry is defined as one that is in a state of decline from which it will never return.

I am not sure how that applies to New Brunswick and to the sale of NB Power to Hydro-Quebec. The power-intensive industries in this province are forest products, mining, petrochemicals and other types of manufacturing. In fact, when I look at the 20 top export industries from New Brunswick (which account for 94 per cent of all exports), at least 15 of them are electricity-intensive industries. While the end products may be changing, there is no doubt that forest products, mineral resources, petrochemicals, and many of New Brunswick's manufactured products will be in high demand for generations.

In fact, I would argue that many of these industries are actually 'sunrise' industries. I believe we are only starting to scratch the surface of the natural gas potential under our feet. A report out last week estimated that between Sussex and Elgin in southern New Brunswick there is an estimated 67 trillion cubic feet of what is called shale gas - natural gas trapped in a 300-metre-thick shale formation. The forest products industry, which has been in a gut-wrenching state of change in recent years, is now turning the corner and should be on the upswing assuming that the business case for investing here can be solidified. The fishing industry, which has also faced its share of challenges over the past 20 years, still generates more than $800 million worth of exports from the province each year - hardly the definition of sunset.

But what is the common thread running through the potential of all these natural resource-based industries? There must be a strong business case for companies to continue investing here and this business case has a lot to do with good, smart, stable and long-term public policy.

The timing and impact of extraction of that shale gas will have a lot to do with public policy. The success of the forest products industry will be grounded in good policy - the cost of energy, silviculture on Crown land, the use of biomass - all shaped by public policy. The same could be said for fishing and agriculture as well.

The other frustrating aspect is that many people set this up as a binary choice.

We must either support the growth of new knowledge-based industries or support our natural resource-based industries.

We need viable economic engines to support the provincial economy into the future and there is a place for both the new and the traditional.

There is a famous Gordon Lightfoot song with the line "Sundown, you'd better take care if I find you've been creeping 'round my back stairs".

Despite what some are saying, I don't think sundown is creeping 'round our natural resources-based industries.

David Campbell is an economic development consultant based in Moncton. He writes a daily blog It's the Economy Stupid, at www.davidwcampbell.com.