Background

Traditionally, wetlands were perceived to be obstacles - any drained wetland was superior to an undrained one. With the arrival of the first European immigrants, many people were employed and companies prospered in response to the development of the nation. There was a need to clear land for habitation and agriculture, dig tile drains and ditches, design special roads and infrastructure across wetland terrain, mine peat for fuel, and sell swamp for cedar for fences, ash for furniture and pine for British naval ships. In more recent decades with conservation efforts to protect wetlands, an enlightened populace and agencies were needed to develop new policy and regulatory guidelines and undertake wetland resource evaluations and impact assessments. Information and knowledge about wetlands had to be collected because it was realized that wetlands were important for wildlife habitat, water quality, coastal zone protection, watershed protection, biomass storage, climate regulation, pollutant absorption, subsistence production and cultural and spiritual uses.

Current practices on the use and management of wetlands wisely has, yet again, created the need to invent new nature-sensitive technologies and practices for the benefit of both human society and the wetland resource. This evolution in the way Canadians have come to view wetlands has created business opportunities, some that have come and gone and others await new entrepreneurial spirit. Canadians today have the opportunity and perhaps obligation to be world leaders in a wetland industry because of our wetland wealth and our long history of dealing with wetlands.

Are we aware of what the businesses are that make up the wetland industry in Canada? Are these businesses that have a common resource interest themselves aware of whom they are? Is there any benefit of these businesses coming together to share experiences to ensure best management practices and care for the wetland resource on which they are so strongly depend? What is the advantage in dealing with the wetland resource in a more business-like fashion? Do we have a true appreciation of the value and impact of these businesses on local, regional and national economies? How does this largely unknown industry contribute to the economic well being of Canadians and Canada?

What is the Canadian Wetland Industry?

The view taken in this paper is much broader than conventional viewpoints. Any and all activity surrounding wetlands is a business as defined above. The facts are that many Canadians depend upon wetlands for their livelihoods. Many Canadian enterprises, both for profit and not for profit have had and will continue to have long-established business interests surrounding wetlands. The vast majority of these enterprises is small to medium in size and is situated in rural and economically disadvantaged parts of the country. Alone, any one of these enterprises might not be considered to be significant, but together and because of where they are located, they in total are extremely important and significant.

Key Issues

Table 1 provides examples of enterprises in each sector that exemplify this wetland industry. Each of these sectors has measurable economic impacts (as highlighted in Table 2), although comprehensive data have never been collected for the wetland industry as a whole. However, we can examine data for small components within the various sectors. Included in the Products and Manufacturing Sector are the enterprises focused on collecting and selling the raw materials from wetlands and those enterprises that are transforming wetland materials into some value-added product. This sector is largely comprised of wholesale enterprises. The Canadian peat moss industry is one of Canada’s longest running wetland industries (Warner and Buteau 2000). It is a wetland industry that has taken a leadership role in responsible resource use and economic development. Canada is the world’s largest producer of horticultural peat moss, a position it has held since World War II. In 1999, CA$170 million was generated from peat moss, 75% from activities in Quebec and New Brunswick (Daigle et al. 2001). Canadian peat is used not only as raw material for a garden soil conditioner but can be processed into a number of products such as peat pots, boards and pellets for nurseries, specialized soil mixes, industrial absorbent material, charcoal and filtration material, and insulation.

Another wetland industry that has emerged in Canada in recent years is the harvesting of cranberries for many products. The total exports of Canadian cranberries, all of which were grown on managed bogs, generated between CA$29 to CA$60 million in 1998 and 1999 (Vandenberg and Parent 1999). British Columbia alone is the world’s third largest producer growing about 95% of the cranberries in Canada (British Columbia Ministry of Agriculture 2002). These two examples illustrate the measure of gross output of these two small sectors within the Products Sector of the wetland industry, without considering the value-added, employment, and taxation impacts. Black spruce is the dominant tree species on bogs and swamps in the Boreal Ecozone of Canada. It is also the preferred species used in the pulp and paper industry yet there has been little attempt to manage the wetlands on which black spruce grows for pulp wood production. This is perplexing when there are extensive stands of swamp and bog black spruce close to existing pulp mills, much closer than the far greater distances preferred for the harvesting of black spruce on upland sites. There is a multitude of low to high-end value-added products that exist or await invention such as cranberry liqueurs, cattail flour, wastewater treatment units, wild rice popcorn, crafts and artwork, books, pharmaceutical and related products, contaminant-free durable construction material for wetland trail boardwalks, and mosquito and black fly protection products.

Another group of enterprises in this sector are those involved in the design and manufacturing of special wetland instruments and equipment used in the wise-management of wetlands, such as the field equipment used in mining peat in the peat moss industry, the “cookie cutters” for maintaining open water in marshes, and special wetland tour boats, rail cars and all-terrain vehicles for transporting people in and out of wetlands in support of activities in the Services Sector. Also, there are enterprises that manufacture packaging materials for delivering wetland products to market such as the plastic bags for packaging peat moss bales or the packaging and the packaging used for the various wetland food products. The potential for growth in both the domestic and export markets in this sector is huge. There is great opportunity to develop and market the “Canadian brand” in this sector.

Businesses representing the Supplies and Distribution Sector are largely retail that supply, market and distribute various the products and goods produced by the manufacturing sector. These enterprises may not necessarily specialize in wetland products but include them in their activities. All transportation activities associated with the movement of wetland materials and products are another big component in this sector.

The Services Sector can be subdivided into two subsectors, private and not-for-profit enterprises and public enterprises. In the case of the former subsector, Ducks Unlimited Canada can be cited as an example in the Services Sector. It is probably the largest business specializing in wetlands management in this country as well as the United States, Mexico, Australia and elsewhere. Its 2001 annual budget was $78 million (Ducks Unlimited 2001). Another large component in the private subsector is represented by the multitude of Canadian environmental and engineering consulting companies. Nearly every such company in Canada is involved in wetland work in some fashion, although few promote that aspect of their company profile as strongly as they should. The hundreds of these enterprises that exist across the country exemplify the importance, need and diversity of wetland issues for which professional services are required, both domestically and abroad. Unfortunately, there has not yet been any attempt to tally the economic worth or scope of this activity or to use existing mechanisms that might promote it. Industry Canada, for example, has a national database of corporate consulting expertise in environmental fields but almost none of the firms listed highlight their wetland consulting expertise. Closely connected to the consulting enterprises are contracting and construction businesses involved in building wetlands themselves and in building roads, pipelines, fishways, reservoirs and other structures in and around wetlands. These companies require specialized wetland experience and skill because wetland terrain is distinctly different than skills and equipment utilized on upland terrain.

Recreational and tourist activities are another large component in this subsector that is fast growing and probably as yet under-utilized. For example, a single but important wetland comprising most of Point Pelee National Park in Ontario, is estimated to generate CA$386,000 annually (Environment Canada 2001). There are at least another 100 or 150 wetlands in parks and wildlife sanctuaries elsewhere in Canada that are equally attractive to hundreds or thousands of visitor birdwatchers, hikers, campers and weekend naturalists annually. Examples of such sites dominated by wetland systems are the National Wildlife Areas at Cap Tourmente in Quebec, Cape Jourimain in New Brunswick and Last Mountain Lake in Saskatchewan. Other heavily visited sites are provincial wildlife management areas such as the George C. Reifel Refuge in British Columbia and Oak Hammock Marsh in Manitoba. A considerable amount of wetland recreational activities occurs in our typical Canadian wilderness near remote and often aboriginal communities. This brings revenue, and often the only revenue, to these isolated communities. Significant local cultural opportunities from waterfowl festivals to natural history beauty contents have arisen in relation to such local wetland resources and recreational interests in many of our small towns across the land. Some activities revolve around celebrating World Wetlands Day and World Bog Day. Again, nobody has yet assessed the economic contributions, in both direct gross output and associated multiplier effects of this activity in the country.

A fast growing component included in this subsector includes professional, advocacy, awareness-raising and charity groups that do not operate with profits. They range in size from small locally based citizens groups to large international groups with a large interest in wetlands such as the Nature Conservancy, the World Wildlife Fund, and the Society of Wetland Scientists, and the International Peat Society.

A public sector, comprising local to federal governments, characterizes the second major subsector in the Services Sector of the wetland industry. Despite government budget cuts in recent years, downsizing of operations, and privatization of some traditional governmental activities, there remains a vital and important role for wetland agencies that are supported by public funds. Because the wetland resources themselves and the activities and interests surrounding wetlands are unlike other natural resources, wetlands have fallen between the cracks with no government agency with a wetland mandate. It may be appropriate to create a government agency with a mandate whose role would focuses on the regulation, management and protection of existing and future wetland resources. Only 10% of Canadian wetlands are in protected areas. Much remains to be done to ensure removing important and representative wetlands from the threat of unwise and non-sustainable threats to ensure protection of species at risk and ecologically sensitive habitats. Not only is it important to protect wetland ecosystems per se, but also consideration must be given to wetlands for their role in the protection of large water supplies unthreatened by contamination. Wetlands as large water reserves are becoming more critical than ever as water supplies shrink, climate becomes drier and new water contamination sources are discovered. Currently, public access to, and therefore public appreciation of, wetlands is poor. A very small and unrepresentative proportion of Canada’s wetlands are within a 50 km drive of over 60% of Canadians. It is important that we work towards ensuring that our children learn about and gains first hand awareness of this distinctive and valuable part of their homeland. Growing up not knowing where their cranberry juice comes from is like growing up not knowing where milk comes from. As we encourage and create opportunity for our children and many others to learn about wetlands, we need government bodies that will regulate and control all such activities in a reasonable and organized way. Canada was the first country to have a Federal Policy on Wetlands Conservation, much to the surprise and envy of many countries much smaller in size and with much less wetland than Canada. This policy applies only to federal lands but a large proportion of Canada’s wetlands are on land under federal control.

Wetlands have a large role to play in our national carbon inventory and as such represent major carbon reserves in the country. The net carbon stored in our peatlands and in other organic-rich wetland soils greatly exceeds the carbon stored in the nation’s forests and agricultural soils, yet goes unrecognized for its role in balancing greenhouses gas emissions and carbon sinks in Canada. How, and if, this carbon is to be priced in terms of economic worth for sale and trade on the world market or for credit in meeting international obligations to off-setting carbon emissions has yet to be determined. While government departments and groups such as Ducks Unlimited have taken a lead in this area, there will continue to be the need for greater evaluation of the importance of wetlands in the climate change initiative now that Canada has ratified the Kyoto Protocol. Governments in particular must be heavily involved in managing wetland resources, in terms of needed research, evaluation and a direct management responsibility for vast wetland areas found on Crown lands, wildlife reserves and parks. Contrary to current government trends, there is and will continue to be a need for regulation, policy development and legal enforcement. Existing policies and regulations evolve and new ones will be needed. Government bodies are the only agencies that can do this. There will continue to be those who monitor the extent, health and inventory of existing resources. Law enforcement and conservation officers will continue to be required to manage resources.

The role of Canada’s public and private organizations in the last sector, the Knowledge Sector, cannot be underestimated. Universities, colleges, governments and private organizations (i.e. Crown corporations and Networks of Excellence) are involved in various aspects of research and development on wetlands. Public and high school curricula in some provinces incorporate local and traditional wetland knowledge in educational modules. There is also training of wetland specialists and entrepreneurs who will be equipped to contribute the latest and newest to the industry. There is economic worth in these activities first as operating units and in the new knowledge that will be transferred in the newly trained personnel and in the spin-off enterprises that will result from this activity.

Challenges

Lack of identity of wetland resource: We have been slow to recognize that wetlands contribute significantly to the Canadian economy. As such, we must characterize and quantify the economic impacts and social benefits of each of the sectors or sub-sectors involved in the wetlands industry. Part of the difficulty has been that the wetlands industry is diverse and the business enterprises perhaps unconventional. The wetland resource can and should be viewed in the same way as other natural resources such as forests, fisheries and mining. It is likely to be revealed that wetlands contribute as much or more to the economic well being of Canadians as other resource sectors. Wetlands have been a component of the landscape that has been difficult to differentiate from other landscape units. There is now consensus in the scientific community that wetlands are distinctive and unique landscape units and that perhaps only Russia has more wetlands than Canada. The wetland resource needs to be managed differently than other resources and in ways that are specific to wetlands.

Lack of recognition of the wetland industry: Canada has a long and well-established history of business involved with wetlands. The industry is different in some ways than other industries. It is also diverse and difficult to define clearly which may have contributed to its low profile or apparent lack of identity. Clearly, there is a large industry linked to this common wetland resource. The wetland resource is something that can be regarded as uniquely Canadian.

Lack of tools for resource economic evaluation: After more than 20 years of work, there are tools, such as a Canadian Wetland Classification System (Warner and Rubec 1997), that are important first steps in characterizing the wetland resource of the nation. Canada was one of the first countries in the World to have a national wetland classification system. Also, in spite of its large size, we have a good first approximation on the nature and extent of Canadian wetland resources though improvements are still required. There is however an urgent need to develop tools to allow assessment on the value and economic impact of the wetland resource of Canada. Regional tools for some aspects of wetland significance exist but nothing nationally. Methods and models for quantifying some aspects of the economic contribution of wetland resources also exist, and even some specialized tools exist for some small sectors of the wetlands industry (i.e. Dufournaud et al. 1999). However, much that has been done is localized geographically and unrepresentative for the wetland industry as a whole. Economists and wetland specialists must work closely together to better assess the true economic worth of the Canadian wetland industry.

The available techniques need to be explored and tested or modified to suite the various sectors in Canada’s wetland industry. There may also be the need for new techniques to be developed. Confidentiality reasons may prevent some information from being available to adequately assess and quantify economic impacts. Estimating economic impacts in some sectors may prove difficult. However, we should attempt at least good first approximations. This would be more than what currently exists.

Industry is comprised of small enterprises: Many of the businesses are small enterprises – many being family-run operations. There may be reluctance or a feeling of being “too small to count.” Individual operations, indeed, may be too small to influence or regulate their own industry in areas such as pricing, total supplies, production quotas, product quality, industry codes of ethics or other business aspects that will ensure their position in the economy. Regardless, there is much to be gained by working together and pooling resources as a group of independent operations or businesses, not unlike other associations, councils, and administrative units representing business enterprises.

Industry is intermittent: Much of the wetland industry is seasonal with many operations or activity occurring in the spring-summer-fall. This is not a characteristic unique to the wetlands industry, being true of most natural resource industries.

Industry is diffuse: Much of the business involved the wetland industry are widely scattered, being located in rural and remote regions of the country. This is both a weakness and strength in that they are situated in economically disadvantaged parts of the country. The wetland industry may be the sole economic activity in these regions.

Non-entrepreneurial mindset: There must be a willingness to change old ideas on how some sectors of the natural resource sector, in general, and a readiness to accept the new and different requirements offered by wetland resources to take full advantage of the economic opportunities. For example, even though business as usual in non-wetland may be “easier” than wetland, there must be an open-mindedness to accept the new challenges and economic opportunities of wetland resource.

Barriers

The Canadian wetland industry’s enterprises have been slow or reluctant to recognize themselves and the value of their existence. To some, the very concept of a wetland industry may seem strange or unnecessary. Efforts, therefore, should be made to raise the profile of the wetland industry and its contribution to the Canadian economy. As such, there is considerable merit in the industry coming together to identify a common purpose and the diverse and cross-linked interests in the wetland resource.

Opportunities

There are many opportunities that can be promoted by common action:

• The Canadian wetland resource is huge
• No other country has as the extent and diversity of wetland resources as does Canada
• Canada has been a world leader in recognizing the importance and value of wetlands resources and has the unique opportunity to (and obligation) to continue to be a leader
• Canada has a long history of entrepreneurship and innovation with respect to its wetlands resource that have led to prosperous businesses and contributions to local and national economies
• Canada’s wetland industry is a well kept secret that must be promoted and have its profile raised both nationally and globally
• The wetland industry has much potential to expand existing activities and move into many new, as yet, under-exploited sectors
• Canadian businesses can work with each other and can assist and teach other nations about Canadian approaches, policies and technological innovations internationally
• The Supplies and Distribution and Services sectors in the wetland industry represent major areas for growth
• A large part of what the wetland industry does involves “green” ecologically friendly technologies that are the technologies of the future

Recommendations

1. A national workshop should be organized with representatives of the various wetland industry sectors and other stakeholders involved in the wetland industry as a means of recognizing, promoting, supporting and producing a product representing the wetland industry in Canada.
2. Representatives of the wetlands industry should establish an association to represent their interests, give profile to and develop sound business and management practices (including sectoral Codes of Conduct) for the on-going wise-use of wetland resources.
3. A “Wetland Industry Association” should develop partnerships with other businesses, governments, and public enterprises, both within Canada and abroad.
4. Organize an annual National Wetlands Trade Fair and Information Forum
5. An economic study should be undertaken that characterizes and quantifies the contribution of the whole wetland industry in Canada, sector by sector, including gross economic output, spin-offs and multiplier effects (as suggested in Table 2).
6. Economic development assistance programs should be put in place to support existing activities and encourage new growth of the wetland industry, especially in view of the fact that the wetland industry is a major economic driver in economically disadvantaged regions of the nation.
7. Provide information, know-how and financial support to small to medium size entrepreneurs interested in establishing wetland businesses such as through existing government programs (i.e. Industrial Research Assistance Program of the NRC) or through private organizations (i.e. Canadian Innovation Centre or through financial institutions).
8. Products and Manufacturing Sector:
   • work towards adopting an industry policy on the wise use, management and protection of wetland resources
   • adopt an industry product certification program
   • develop an industry long-range resource plan for the wise-use, management and protection for wetland resources and more detailed marketing plans for specific subsectors
   • assess the potential feasibility of adopting a resource utilization levy for reinvestment into the management and protection of future wetland resources
9. Supplies and Distribution Sector:
   • probably similar to recommendations given for the Products and Manufacturing Sector
10. Services Sector:
    • compile a directory of businesses in the services sector
    • support the training and accreditation of wetland professionals
    • have wetland resources recognized and governments take on responsibilities for wetland resources as they have for other natural resources in Canada (i.e. forests, fisheries and mineral resources. Wetland resources are the only natural resource sector not recognized by federal or provincial governments in Canada.
11. Knowledge Sector:
    • support the compilation and publication of a volume on state-of-the-art information on Canada’s wetland resources
    • support and provide funding for the resurrection of Canada’s National Wetland Working Group
    • continue with exploration, assessment and inventory of the whole wetland resource in Canada
    • opportunities for R & D business partnerships between research enterprises and specific sectors of the wetland industry should be identified, prioritized and funded (i.e. R & D tax credits)

Acknowledgements

I am grateful to my wetland colleagues, entrepreneurs, innovators and business associates in Canada and abroad for thoughtful discussions over the years who shared ideas and experiences with me so that I could write this paper.

References

British Columbia Ministry of Agriculture 2002. Cranberries. Plant Products, Ministry of Agriculture, Food and Fisheries, British Columbia. (http://www.agf.bc.ca/aboutind/products/plant/cranberry.htm).

Daigle, J-Y. H. Gautreau-Daigle, and D. Keys. 2001. Canadian Peat Harvesting and the Environment. Second edition. North American Wetlands Conservation Council (Canada), Sustaining wetlands Issues Paper,No. 2001-1. Ottawa, Ontario.

Ducks Unlimited Canada 2001. Annual Report 2001. Ducks Unlimited Canada. Stonewall, Manitoba.

Dufournaud, C.M., J.T. Quinn, A. Olinsky, and B.G. Warner. 1999. Calibration of cost functions for individual firms as an alternative to estimation: An application to New Brunswick peat-mining firms. Environment and Planning 31:551-558.

Environment Canada. 2001. Putting an Economic Value on Wetlands – Concepts, Methods and Considerations. Great Lakes Fact Sheet. Environment Canada. Downsview, Ontario.

Rubec, C.D.A., P. Lynch-Stewart, I. Kessel Taylor and G.M. Wickware. 1988. Wetland utilization in Canada. Chapter 10 in Wetlands in Canada. Environment Canada and Polyscience Publications. Ottawa, Ontario.

Vandenberg, J. and G. Parent. 1999. Profile of the Canadian Cranberry Industry. Report? Fact Sheet? Market Industry and Services Branch, Agriculture and Agri-Food Canada. Ottawa, Ontario?

Warner, B.G. and P. Buteau. 2000. The early peat industry in Canada, 1864-1945. Geoscience Canada 27:57-66. Warner, B.G. and C.D.A. Rubec (editors). 1997. The Canadian Wetland Classification System. Second Edition. National Wetlands Working Group. Wetlands Research Centre. University of Waterloo. Waterloo. Ontario.