A shift in perspective is currently taking place within the pulp and paper industry¹ towards greater product diversification. Among other things, this is a consequence of declining de­mand for certain paper products and the fact that there are increasing numbers of custo­mers who want to replace fossil materials with sustainably produced biomaterial. The transition has accelerated, but is associated with major challenges for the actors in the sector.

One major challenge is moving the companies from an overall focus on making their internal processes more efficient in order to cut costs, to thinking at least as much about customer knowledge, business strategy, partnership and sustainability. The govern­ment has an important role to play in this readjustment.

A comparative analysis of countries’ innovation strategies

The aim of the report is to examine how the government can contribute to a more com­petitive pulp and paper industry. Sweden has historically been successful through political measures which have contributed to making the industry more effective and reducing emissions. However, the challenge today is much more to do with meeting needs that exist in markets where the pulp and paper industry has not previously been active.

The analysis is based on a comparison of a number of countries that are major producers of pulp and paper. The main countries to be illustrated are Canada, Brazil, India, China, Japan and Finland.

Some countries have an innovation strategy with clear priorities

Canada, Finland and Japan all have politically supported innovation strategies with clear priorities. The strategies in Finland and Japan are principally based on clear social priori­ties. The Japanese strategy is primarily based on materials research, which is one of Japan’s strong areas. The Finnish strategy is based on preserving and developing the country as a major forest nation and thus that the Finnish forest should be used as a raw material when technically possible. The Canadian strategy is more market-oriented. Priorities are set jointly by businesses, government and universities, and changes take place over time. Companies from customer groups are included in this work. These priorities govern which areas receive research support.

Some aspects which connect these strategies are:

• They are based on a social need which entails a transition to fuels and materials derived from biomass.
• Different government departments perform this together, which increases clarity for businesses, organisations and universities. A clear government prioritisation also facilitates work on matters pertaining to state-aid.
• The strategies in Canada and Finland also prioritise export incentives with businesses, government and universities acting jointly in a small number of countries. These initia­tives cost a lot of money. For example, the federal government of Canada invest more than 60 million kronor a year in export initiatives outside North America. Investments in export activities also come from the provinces. The province of British Columbia invests almost 12 million a year in export initiatives to India.

Important lessons for Swedish public measures

Sweden can draw a number of lessons from the countries which are included in this analy­sis. The most important include:

• The government needs to prioritise which social problems are to be dealt with and, as part of this, to justify how the bioeconomy is a solution. It might concern changing to materials and fuels that are sustainably produced from biomass.
• Based on this prioritisation, the government should implement an initiative over a period of several years with sufficient resources to make a difference. This should include investment aid for large projects similar to that provided in Finland. Measures to incentivise exports should also be included, but only to a number of selected and prioritised markets if it is to have an effect.
• The government needs to stimulate a greater focus on new markets. This can take place through research programmes and through promoting discussions between the industry and other customer groups.

¹ In the pulp industry pulp is produced from wood. It can be paper pulp, but also textile pulp or packaging pulp. In the paper industry paper is produced from paper pulp. The manufacture of pulp and paper can take place in the same mill, a so-called integrated mill.