Think-tank predicts short-term decline in mining

ODILE NELSON

The Conference Board of Canada’s updated economic forecast for Nunavut confirmed that Nunavut’s mining industry will take a nose-dive before slowly reviving in 2007.

Graeme Clinton, a senior economist with the Canadian think-tank, presented the revised statistics at the opening of last week’s innovation summit in Iqaluit.

Mining currently accounts for 25 per cent of Nunavut’s economy. By 2006 it will only make up three per cent, as mines close but aren’t replaced by new ones.

“[The closures] will have a dramatic impact on what the economy looks like in the territory. And what we’re going to see is there’s going to be a greater reliance on some of the emerging industries,” Clinton said.

“There’s going to be a greater reliance on fishing, on food-processing, on tourism, on the arts and cultural sectors. These are going to be the new engines of growth over the medium-term.”

Gordon said though the mining industry’s short-term decline will lead to an overall drop in Nunavut’s gross domestic product, it will have little impact on most Nunavummiut.

This is because few Inuit actively control or participate in the territory’s mining — instead southern Canadian companies dominate most of the industry.

In fact, the temporary mining slow-down, Gordon said, presents an opportunity for Nunavut’s various government and Inuit organizations to reorganize the industry.

NTI and the government of Nunavut need to establish training and hiring policies that ensure Inuit firms are contracted for more of the mining services, he said.

“There is opportunity in the mining sector but you have to take advantage of it. You have to be very careful about how you go about it. And ultimately when you look at 2010, it [mining] is contributing over 20 per cent to the GDP again but what’s most important is that number is not the same as the number in the year 2000 because out here [in 2010] there’s actual participation by Nunavummiut.”

Gordon offered a similar analysis of Nunavut’s current fishing industry — saying Nunavummiut must begin to take financial control over the territory’s offshore fishing stocks.

In 2001, fishing and hunting contributed only $200,000 to Nunavut’s real gross domestic product.

Gordon said this figure is startling considering the amount of fishing, hunting and sealing that occurs in the territory.

But, like the mining industry, Nunavut fishing interests are dominated by outside companies.

“Nunavut is not really participating in its fishing industry. There’s no registered offshore trawler to Nunavut. The fishing that does take place is done by Quebec and Newfoundland companies. They are contracted by Nunavut and some of them have agreed to pay Nunavummiut and some pay a royalty and they have to land some of their fish at the Pangnirtung fish plant,” Gordon said.

“But this is a very small portion of the total possibility which, sort of, lies behind the fishing industry. Now when I say there is no trawler, I mean these things cost $25 million — it’s a big investment. But if you want to reap the wage-based economic benefits from fishing…. you have to participate in the activity.”

Gordon however could offer few suggestions on how NTI and the Government of Nunavut could raise the money needed to develop the training programs or purchase the infrastructure needed to take control of these industries.