Re-Thinking Economic Strategies

“…aspects of a nation, which some call cultural, cannot be separated from economic outcomes.” Michael Porter, The Competitive Advantage of Nations

British Columbia grew and prospered as a province by exploiting its resource base. British Columbians came to view themselves as living in a “wealthy” province, and to expect first-rate social services. But since the early 1980’s, their sense of economic well-being has become more tenuous, at times faltering badly. The province’s sense of confidence in its future was most badly damaged by the at times almost hysterical rhetoric of the political opposition in the late 1990’s. And because the election of the Liberal government in 2001 did not have the magical effect promised, the economic confidence of many British Columbians is continuing to erode.

In fact, the lagging economic performance of the province over the past 15-20 years can be attributed in large part to the lagging economic performance of its leading industry. Between 1984 and 1999, the provincial economy grew by about 60 percent, while the forest sector has expanded by less than 15 percent (R.E. Taylor and Associates, 2003, p.3, report prepared for Forestry Innovation Investment). Currently, the forest sector’s direct contribution to provincial GDP is only about 7 percent, and continuing to decline.

The impact of the declining role of the resource industries in the provincial economy is of course greatest in communities where resource related jobs, especially forest sector jobs, have been the linchpin of the local economy, and where job losses in traditional industries are not easily offset by growth in other sectors. But even in the major urban centres, the decline of the resource industries, and conflicts and turmoil associated with that decline, have had a negative impact, both on the real economy and on people’s general sense of economic well-being and economic confidence. And the real sense of uncertainty and dislocation associated with an economy in transition has been badly exacerbated by politically motivated, sky is falling rhetoric.

The economic malaise effecting British Columbia will certainly not be cured by the radical tax and service reduction experiment currently being carried out by the Campbell Liberals. Nor will it be cured by ignoring the forest sector and other resource industries, or by attempting to restore them to their former glory. What is needed is a new economic vision which supports communities, knits together the most vital, forward looking components of all sectors of the economy, and inspires a dynamic new economic and cultural identity for the province.

Priority initiatives

Keeping communities whole

Getting serious about value added, and getting it right

Re-imaging, re-imagining

Smart economy, smart economics, smart money

Please send comments on the Campaign for Change policy working papers to [email protected] before

November1, 2003