Vive Le Canada

Forestry officials applaud aid package, press for more action on power costs
Date: Thursday, February 23 2006
Topic:


GILLIAN LIVINGSTON February 22, 2006 - 19:20

"We think this is what is required in order to help the industry turn the corner," Ontario Premier McGuinty said after his announcement to more than 100 forestry industry and municipal representatives.. (CP PHOTO/Nathan Denette)

TORONTO (CP) - Officials from Ontario's forestry industry welcomed a three-year, $220-million aid package Wednesday they say will help shore up its shaky foundations, but warned they won't be competitive until the province deals with high power costs.

U.S. trade officials, meanwhile, accused Ontario of inflaming cross-border trade negotiations on the contentious softwood lumber issue.

The province's forestry companies say the money is necessary to address electricity bills that are at least twice the size of those of their Manitoba and Quebec competitors. The industry has blamed the high price of power for nearly 4,000 recent job cuts in Ontario and plans to shut down several plants.

Premier Dalton McGuinty acknowledged Wednesday that there's no assurances the aid package - the fourth since last summer - will staunch the bleeding.

"We think this is what is required in order to help the industry turn the corner," McGuinty said after his announcement to more than 100 forestry industry and municipal representatives.

"We can't make a guarantee that there will be no more job losses, but what we do believe is that we've put in place now the necessary supports to ensure that we can turn the industry around and put it on a more sustainable footing."

But a U.S. official said the cash infusion fuels an already tense international trade conflict over softwood lumber.

"Ontario's announcement complicates our efforts to reach a long-term negotiated solution to the softwood lumber dispute," said Neena Moorjani, spokeswoman for the U.S. Trade Representative's office.

The American lumber industry has long accused Canada of wrongly subsidizing its softwood producers, an allegation the industry has denied.

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