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2010/93 (a)


Government of Canada Invests in Forest Innovation and the Bioeconomy

The Government of Canada recognizes the vital role the forest sector plays as an economic engine in rural communities, a driver of innovation and key player in the growing bioeconomy.

Canada’s forest sector is undergoing important restructuring due to a number of competitive challenges, including declining demand in the United States’ residential construction market, increased competition from companies in emerging countries and a global recession. Despite this transition period, new technologies and new markets offer a promising future for Canada’s forest sector. Diversification of products is essential to the sector’s continued evolution and future success.

That is why the Government has worked with industry, provincial governments and other key stakeholders to help transform the industry and to help it take advantage of the growing bioeconomy, where innovation and environmental performance are key.

Supporting the Bioeconomy of British Columbia

The Government of Canada, through FPInnovations, is investing up to $2.5 million in a pilot-scale demonstration project in Crofton, British-Columbia. A new technology designed to help improve the environmental performance and competitiveness of the forest products manufacturing sector will be demonstrated at the Catalyst mill in Crofton, B.C. In collaboration with Elemental Energy, the industrial lead on this project, and Paradigm Environmental Technologies, this project is being developed by FPInnovations, a not-for-profit organization that focuses on developing and commercializing next-generation forest products using wood fibres. Funding is provided through the $40-million Transformative Technologies Pilot Scale Demonstration (TTPSD) Program from Canada’s Economic Action Plan. The TTPSD Program is helping forest sector mills to build pilot-scale demonstration projects to manufacture innovative products for eventual commercial applications.

Under the Economic Action Plan, the Government of Canada lists innovation of forest products and market diversification among its key priorities for the forest industry. By collaborating with FPInnovations and other organizations, such as Elemental Energy and Paradigm Environmental Technologies, the Government is acting on its commitments to support the sustainability and viability of the Canadian forest sector.

Promoting Forest Innovation and Investment

The Government of Canada is committed to helping Canada’s forest sector take advantage of these new opportunities by researching innovative products that meet the needs of the marketplace. The key to a strong future for the forest sector is to promote innovation and entrepreneurial activity within a competitive business environment.

As outlined in Canada’s Economic Action Plan, the Government of Canada is providing $170 million over two years to improve the forest sector’s long-term competitiveness through renewed investments in market diversification and forest innovation. This funding includes $120 million to help promote forest innovation and investment and $50 million to expand market opportunities for Canadian forest products. Other key Government of Canada initiatives in support of forest sector sustainability and renewal include the $1-billion Pulp and Paper Green Transformation Program. Budget 2010 committed an additional $100 million over four years to support the development and commercialization of advanced technologies in the forest sector.

Support for Workers and Communities

In addition to its ongoing support of Canada’s forest industry, the Government of Canada has also put in place the $1-billion Community Adjustment Fund and the $1-billion Community Development Trust to help mitigate the short-term impacts of economic restructuring in communities hard hit by the recession. To minimize the financial impact of the downturn on workers and their communities, the Government is providing $200 million to extend work-sharing agreements over the next two years to a maximum of 52 weeks. This funding will help assist employers and employees avoid temporary layoffs while their industry recovers.

For additional details on the Government of Canada’s Economic Action Plan, visit

Richard Walker
Director of Communications
Office of the Minister
Natural Resources Canada

Media Relations
Natural Resources Canada

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