Backgrounder Softwood Lumber Action Plan

Canada’s forest sector is a vital part of the Canadian clean growth economy and is crucial to the well-being of the more than 300,000 Canadians directly or indirectly employed in the forest industry. Today’s announcement delivers on the Government’s pledge to take swift action to support the companies, workers and communities that depend on the industry, in the following areas:

Loans and Loan Guarantees

Financial and Risk Management Solutions
(valued at up to a combined $605 million)

Companies can take advantage of financial products and services, including loans and loan guarantees under the Business Development Bank of Canada (BDC) and Export Development Canada (EDC).

EDC and BDC have market-based financial and risk management solutions on commercial terms that are available to forestry businesses of all sizes and can assist viable companies looking to make capital investments, expand market opportunities and diversify into new markets.‎ Funding for further loan guarantees may be considered by the Government in the future to address changing market conditions.

Market and Product Diversification

Expanding Market Opportunities (EMO) Program
($45 million over three years starting in 2017–18)

Natural Resources Canada’s Expanding Market Opportunities program will increase and diversify market opportunities for Canada’s forest products industry in offshore markets and expand wood use in non-residential and mid-rise construction. This new funding will provide much needed stability to this industry/government partnership to further stimulate new and existing markets for Canadian wood products at home and overseas. This program will continue its ongoing success in helping to expand markets by encouraging the use of wood in construction to sustain hundreds of thousands of good, middle-class jobs in communities across our country.

Investments in Forest Industry Transformation (IFIT) and Forest Innovation Programs (FIP)
(IFIT: $55 million over three years; FIP: $63 million over three years, both starting in 2017–18)

Natural Resources Canada’s Investments in Forest Industry Transformation and Forest Innovation Programs have been extended to continue to position Canada’s forest sector at the forefront of the emerging bio-economy and reduce reliance on traditional products. These programs help drive innovation from research and development to commercialization and aim to support the development of new technologies and higher-value products that will reduce GHG emissions and contribute to clean economic growth and jobs. This new funding will help the forest sector generate new business opportunities that can help diversify its product portfolio and help position Canada as a global leader in new technology areas.

Job Loss Mitigation Programming and Support

Employment and Social Development Canada
($9.5 million over four years)

In order to help employers avoid layoffs and retain skilled workers, Employment and Social Development Canada (ESDC) supports a Work-Sharing program designed to help employers and employees when there is a temporary reduction in the level of business activity.

This is not a wage subsidy program, but an existing program supplementing the income of Employment Insurance eligible workers who work temporarily reduced hours; it is a temporary measure to extend the maximum duration of Work-Sharing agreements from 38 to 76 weeks to reduce layoffs and retain skilled workers. These measures were also implemented during the oil and gas sector challenges in 2016.

Worker and Community Support

Employment and Social Development Canada
($80 million over two years)

Funding to provinces will be offered through amended Labour Market Development Agreements that will help workers transition to new employment opportunities while Targeted Earnings Supplements will provide workers with salary top-ups to help ease transition to other fields of employment.

Indigenous Forestry Initiative
($10 million over three years)

Natural Resources Canada’s Indigenous Forestry Initiative will support forest-based economic development for Indigenous communities across Canada, by encouraging participation in the forest sector by focusing on three thematic priority areas:

  • clean technology and participation in the forest bio-economy;
  • environmental stewardship; and
  • use and management of forest resources.

This new funding will help the Indigenous Forestry Initiative continue its ongoing success in providing direct funding to Indigenous communities and organizations to support participation in economic development activities related to the forest sector.