Paper mill seizure boosts populist premier
The Newfoundland government has seized a paper mill’s assets following the company’s announcement that hundreds of workers would be laid off and the paper mill shut down.
AbitibiBowater Inc. (and its predecessor company) has had a longstanding agreement with the province of Newfoundland in which it has been given access to the province’s valuable natural resources for its milling and logging business.
IPS reports Newfoundland Premier Danny Williams as saying that:
”For 100 years, Abitibi and its predecessors have enjoyed the privilege of Newfoundland and Labrador’s natural resources … It simply makes sense that if Abitibi are not going to continue the operation of a pulp and paper mill and renege on their commitment to our province they will no longer have access to our natural resources.”
The government announced that it intends to reopen the mill as a public company or in partnership with another forestry firm.
The story also quotes Steven Shrybman:
“Williams has done well playing hardball with companies,” said Steven Shrybman, an influential trade lawyer with the firm Sack Goldblatt Mitchell LLP based in Ottawa.
“Canadians don’t want to be just hewers of wood and drawers of water. The province gave water and timber rights to the company on the condition that they invest and produce paper,” Shrybman told IPS, adding that Abitibi’s legal case is ”anything but a slam dunk if Canada vigorously defends its interests.”