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Newfoundland and Labrador / Economy
Newfoundland and Labrador: Economy
Since its first settlement, Newfoundland and Labrador has been highly dependent on its resource sector. The province was initially settled because of its rich fishing grounds on the Grand Banks. The mainstay of the province's fishing industry has been groundfish (primarily cod); however, other important catches are flounder, redfish, capelin, shrimp and crab. In 1977, the Canadian government extended its fishery jurisdiction to 200 miles around the coast of the province in an attempt to gain better control of fishing activity, but in 1989 it was recognized that many of the Atlantic's key groundfish stocks were in severe decline. Since that period, there have been successive reductions in quotas and fishing moratoria.
The second most prominent industry in the provincial economy is the mining industry. This industry ships mineral products valued at approximately $700 million a year, mostly iron ore from Labrador. Other minerals mined in the province are gold, asbestos, limestone and gypsum. In 1994, a major discovery of nickel, copper and cobalt was made at Voisey Bay and a significant development project is now under way.
The third significant traditional goods-producing industry is the newsprint industry. This industry consists primarily of three pulp and paper mills located in Corner Brook, Grand Falls and Stephenville.
The discovery of offshore oil and gas reserves has added a new dimension to the marine resources of the province. The Hibernia discovery in 1979 was Newfoundland's first significant oil find; reserves are estimated at 615 million barrels.
The province's largest utility industry is electric power. The largest hydroelectric facility is located in Churchill Falls Labrador with a total installed capacity of 5403 megawatts.
Newfoundland's agriculture industry is small. The output of the agriculture industry is mainly for domestic consumption, although some agricultural products such as blueberries and furs are sold to markets outside the province.
Newfoundland's service sector has experienced substantial growth over the years: in 1992, the service sector accounted for over two-thirds of provincial gross domestic product.
In recent years, Newfoundland's efforts to develop a solid tourism industry have intensified. The province's rich cultural and historical heritage and unique character are considered to be major selling features to other Canadians and travellers from around the world. It is estimated that between 265 000 and 300 000 people visit the province each year, spending an estimated $400 million annually.