Paul Stothart is vice-president, economic affairs of the Mining Association of Canada. He is responsible for advancing the industry’s interests regarding federal tax, trade, investment, transport and energy issues. This article was published in August, 2010.
Throughout our history, there has been a call for greater value-added in Canadian resource production. The image of Canada as a hewer of wood and drawer of water has long irritated many Canadians – including politicians and industrial strategists who have felt that Canada should be more sophisticated and more active in manufacturing value-added products.
Rather than exporting lumber, we should export furniture or even prefab houses. In the mining sphere, rather than sending raw concentrate or bitumen abroad, we should be producing refined petroleum products, chemicals, finished jewelry, specialized metal alloys and the like. Or to move another few steps along the continuum, we should have inherent raw material advantages in producing computers, iPods, medical equipment and machinery.
There has historically been some appeal to this argument, including at the political level. Why send something abroad in an unfinished form when additional jobs and wealth could be associated with adding production value at home? This has manifested itself on some occasions in past decades, when inland mineral processing facilities in Ontario, Manitoba and New Brunswick were established largely for political reasons. Several of these facilities are today under competitive pressure – more so because of poor location rather than a failed economic model.