SECTION

C
BUSINESS
EDITOR HARVEY ENCHIN 605-2520 / E-mail henchin@pacpress.southam.ca SATURDAY, MARCH 31, 2001

DOLLAR FLIRTS WITH LOW MARK SHAWINIGAN SECRET

Investors remain extremely risk-averse and are heading How to make money in the prime min-
for safety, says S&P analyst Rob Palombi. C3 ister’s riding. Michael Campbell C2

Silicon Valley ignores Lotusland

British Columbia
Free trade
is a no-blipper,
according to those in
the know in California
in lumber
V to be brief
ancouver likes to think of
itself as an up-and-coming
place to do high-tech busi-
ness. So how large does it appear on
the radar screen of Silicon Valley?
It doesn’t. Not a blip, even.
That’s the assessment of Norman
Lomow, who as head of the Canadi-
an consulate in San Francisco and
Beginning at midnight, Canadians can ship
Silicon Valley, ought to know. to U.S. duty-free until petitions are filed
“Vancouver,
David re a l ly, h a s n o
profile here at
B y G O R D O N H A M I LTO N shipments since mid-April.
On the Riverside trading floor,
Beers all,” he says, his
tone bewil-
As the final hours of the much- impromptu signs erected by sales
maligned softwood lumber representatives earlier this
dered. agreement wind down today, month declaring “no sales” have
When it railcar loads of lumber piled at come down but trading activity
comes to pre- shipping points all along the has not yet begun. The U.S. mar-
senting the Canadian border. ket is expecting Canadians to
Lower Main- Canada has free trade in lum- ship a wall of wood across the
land as an ideal ber with the U.S. after midnight border, glutting the market and
complement to but it is not expected to last long. driving prices down, Steele said.
northern Cali- The countries are on the verge of Major B.C. producers, such as
fornia’s crowd- rekindling a trade war that has Riverside, say they won’t do it,
ed, high-priced plagued the $10-billion-a-year and are asking their buyers to
climate for Canadian lumber industry for accept any potential duty on the
doing tech, “I don’t see a lot of the last 20 years. wood. The result?
activity by Vancouver companies,” The U.S. industry plans to file “We didn’t sell any lumber,”
says Lomow. “ I don’t see anything anti-dumping and countervailing said Steele.
by the city.” duty petitions Monday; a retalia- The agreement has restricted
During a recent visit to Silicon Val- tory shot that could push lumber Canadian exports to the U.S. for
ley, I kept hearing the same “no pro- costs up in Canada by 30 or 40 the last five years to 14.7 billion
file” lament from other Canadian per cent. board feet a year. Anything above
and U.S. observers, and it shocked In Ottawa, that amount
me awake from a self-deluding slum- International was subjected
ber I’ve long shared with fellow Trade Minister to harsh fees.
Lotuslanders. Pierre Petti- Now the
Having arrived here a decade ago grew said there ag reement is
after growing up in Silicon Valley were no formal over, Canadian
and working in San Francisco, I did discussions producers say
what most immigrants do: I looked planned with they will not
for similarities to home. I thought I the U.S. govern- flood the mar-
found them. After all, B.C. likes to ment or indus- ket but many
think of itself as the California of try prior to the companies ran
Canada, leaking stucco be damned. ex p i r y o f t h e out of fee-free
I was reassured to see some five-year quota quota more
familiar ingredients of Silicon Val- agreement, than a month
ley’s success: A couple of big, well- which restrict- ago and are
funded research universities WARD PERRIN/VANCOUVER SUN ed exports from chafing to
milling smart engineers and spin- Newspaper Direct CEO Miljenko Horvat provides a world of newspapers. B.C., Alberta, deliver orders
ning off cutting-edge companies; a Quebec and that have been
diverse population, including many Ontario. delayed as a
educated South and East Asians,
drawn to a culture of opportunity
and tolerance; livability like North-
ern California in the 1960s; and reg-
Vancouver lifestyle still cuts it Pettigrew
also said Cana-
da will not
apply a lumber Pierre Pettigrew
result.
Some hailed
the agree-
ment’s demise,
ular news reports about our bur-
geoning high-tech sector. Just last
year, MacLean’s found five of Cana-
for many new-economy firms ex p o r t ta x to saying the lum-
blunt American complaints that ber sector is finally entering a
Canadian wood is subsidized. period of free trade.
da’s fastest growing high-tech com- By WILLIAM BOEI cruise-ship passengers and even at home, for a “I am confident our companies “The agreement is expiring.
panies right here in B.C. few dollars a copy. have respected their internation- That has been achieved. Now we

Hollywood added it all up — nice
place, highly skilled folks, low, low
dollar — and certainly got the pic-
ture, which is why we get so many
of its pictures. Emboldened by that
success, the Vancouver region had
every incentive to make sure Sili-
con Valley received the same pic-
ture. We had, after all, so much to
gain: The Valley is merely home to
half the patents filed in the U.S. and
three times more venture capital
than anywhere else in the world.
But no, here at the end of histo-
ry’s most lucrative technological
decade, Vancouver finds itself with
“no profile” at the centre of it all,
Silicon Valley.
The same cannot be said for
Ottawa, Toronto and even Montre-
al. Those cities “are all here in full
force,” says senior trade commis-
sioner Lomow, who arranges their
show-and-tells all the time. Even
Winnipeg sent a delegation selling
See SILICON VALLEY C4
M
iljenko Horvat could just as easily
have stayed put on Park Avenue in
Manhattan, or moved into a high-
tech park in Virginia, or headed for
California’s Silicon Valley and the Bay Area.
Instead, he packed his investors’ $5 million
US, moved to Vancouver, opened an office in
Richmond and hung a “Now hiring” sign on
his new dot-com company.
Like the thousands of other large and small
high-tech companies that have grown or set-
tled here, Horvat had his reasons for opening
shop in Vancouver.
They had little to do with liking the city and
everything with a series of rational, hard-
nosed business decisions. His choices help
explain why, despite the market melt-down,
Vancouver appears to have a rosy future in
high technology.
Horvat and his investors developed the idea
for the company, called NewspaperDirect, two
years ago in Manhattan.
The plan was to gather the complete con-
tents of major daily newspapers around the
world in electronic form, ship them around
the world on the Internet, print them on laser
printers and deliver them to hotel guests,
It’s a work in progress, but today you can
order The Vancouver Sun’s current edition to
read over breakfast at the Half Moon Hotel in
Jamaica. or you can have this morning’s edi-
tion of Izvestia delivered at home in Vancou-
ver, alongside your copy of The Sun.
Horvat’s company (he’s president and CEO)
has grown to the point at which revenue has
started to trickle in. It is distributing about
10,000 copies of newspapers a month to 90
distribution sites, including 40 hotel chains.
Another 30 hotel groups are in the pipeline.
Sixty papers from around the world are avail-
able so far.
Horvat figures that within a year or so,
NewspaperDirect will be selling 100,000
copies a month.
Although the head office is officially on Park
Avenue, the work is being done in Vancouver.
“I seriously considered doing something in
the Bay Area because I know many people
there,” Horvat said.”We looked at setting it up
in New York, and we looked at Vancouver
because we had some connections here as
well.
See TASK WAS C5
al and business obligations and can see the way through to fight-
that we will be, Sunday morning ing,” said Doug McArthur, of the
when we wake up, defending Free Trade Lumber Council, an
Canadian access to the U.S. mar- organization of lumber produc-
ket as we must,” he said. ers that opposed settling with the
In the meantime, the railcars Americans before today.
sit. Others say the province’s most
“They are piling up on the important industry is heading
Canadian side of the border,” said into a long period of uncertainty
customs broker Mike Jones. that could lead to sawmill clo-
“We are really waiting until sures and worker lay-offs, even if
next week to see what happens,” Canada wins. A victory could
said Riverside Forest Products take years and in the meantime
president Gordon Steele. “I am Canadian producers could still
playing it safe. In our company be subject to interim duties, said
we are basically loading cars and Bob Plecas, president of the B.C.
positioning them to move when Lumber Trade Council.
we have more certainty.” “We have free trade in lumber
Most troubling for producers starting at 12:01 Sunday morn-
like Steele is a provision in U.S. ing,and 361⁄2 hours later, the free
trade law that would permit an trade in lumber runs out,” Plecas
interim duty to be applied retro- said.
actively if Canadian companies “We will be facing petitions
send a “wall of wood” across the from the U.S. on countervailing
border. That decision will not be duties and anti-dumping.”
made until mid-summer but the
duty would then apply on all See 52 SENATORS C3

MARKETS
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We want our vehicles to reflect our personality
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Daphne Bramham bly describe you with more pre-
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S who’s going to be driving.
A Volkswagen Rabbit
convertible? Definitely a girl car.
cision than an astrologer.
For the record, he drives an
SUV because its all-wheel drive
Miata? Girl car. Mini-van? Soccer makes him feel more comfort-
▲ DOW 30 + 79.72 9878.78 Mom car. TransAm, Camaro? able driving between his home in
▲ S&P 500 + 12.38 1160.33 Guy car. VW’s new Beetle? Baby Oshawa, Ont., and the cottage in
boomer car. Cadillac? Geezer car. Orillia.
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Want to give an air of being For the record, I rarely drive,
▲ LONDON FT100 + 45.3 5633.7 just an ordinary guy, as Jean but when I do, it’s a 14-year-old
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became prime minister? Choose pique when a planned vacation
▲ HANG SENG + 82.75 12,760.64 a Chevrolet. John Healy, director to Asia was cancelled.
▼ CANADIAN $ – $.0007 $.6344 US of engineering and product plan- Healy has spent more than 35
ning for GM Canada, says Chevs years working at GM and has
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IAN LINDSAY/VANCOUVER SUN
It seems what you drive says a slung seats that make for an awk- military personnel carrier that’s
▼ UK POUND – $.0177 $2.2315 lot about who you are (although ward driving position, Healy being produced in limited edition GM’s John Healy shows off the company’s Aztek.
▼ GOLD (N.Y.) – $.90 $257.90 US Healy says the gender identifica- says, “We need to make sure we luxury models. oil embargoes, gas shortages, Many people have also grown
tion is largely a fluke). No manu- don’t do that again.” We’ve grown tired of the aero- higher prices and the environ- to love their mini-vans and SUVs
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