Todd McClay Unveils Plan to Boost Forestry Sector and Economic Growth

“This government is committed to driving investment that will unlock the economic potential of our forestry industry,” Mr. McClay declared.

Forestry Minister Todd McClay unveiled the government's ambitious strategy aimed at rejuvenating confidence and fostering growth within New Zealand's forestry and wood processing sector.

“This government is committed to driving investment that will unlock the economic potential of our forestry industry,” Mr. McClay declared.

He emphasized the pivotal role of forestry in rebuilding New Zealand’s economy, boosting GDP, and generating regional employment in a highly productive sector.

The government’s vision for the forestry sector encompasses several key objectives:

Spurring Economic Growth: Creating jobs and increasing exports.

Delivering Low Emission Solutions: Promoting sustainable practices and products.

Supporting Land Use Resilience, Adaptation, Biodiversity & Social Benefits: Ensuring forestry contributes positively to environmental and social outcomes.

Providing Carbon Removals: Supporting climate change mitigation efforts.

Throughout this parliamentary term, the government plans to introduce a comprehensive package of initiatives to bolster industry growth and achieve positive outcomes across the forestry and wood processing value chain.

“This includes initiatives to boost onshore wood processing, expand market access for our high-quality wood products, streamline regulations, foster innovation in wood products, adjust investment incentives, and support our climate change goals,” Mr. McClay explained.

He highlighted the significance of increasing domestic processing, noting that currently nearly 60% of New Zealand’s harvest is exported. Enhancing domestic processing capacity, he argued, will not only grow the economy but also create more regional jobs and double exports by value within a decade.

In addition to domestic reforms, the government aims to facilitate greater access to international markets for New Zealand wood products by addressing non-tariff barriers, thus providing market certainty crucial for expanding and innovating within the sector.

Mr. McClay stressed the importance of maintaining a balanced approach to forestry management in New Zealand.

“It is crucial to ensure a sustainable supply of logs for domestic processing while encouraging new tree plantings on suitable land to meet our international climate commitments,” he emphasized.

The government has initiated an independent review to assess the operational costs of the forestry component within the Emissions Trading Scheme (ETS). This review will inform decisions on cost recovery fees for the 2024/25 financial year, aiming to ensure the ETS remains cost-effective and efficient for participants.

Furthermore, recent government actions include the repeal of legislation mandating the registration of log traders and forestry advisers, a move aimed at reducing regulatory burdens and unnecessary costs on forest businesses.

“This step underscores our commitment to easing regulatory pressures on forest businesses and supporting their growth and innovation,” Mr. McClay concluded.

The government's comprehensive approach underscores its determination to drive sustainable growth, enhance environmental stewardship, and position New Zealand as a global leader in forestry and wood processing.