BANGOR – A Domtar official presented an optimistic outlook Friday for Maine’s pulp and paper industry but stressed that Maine’s business climate needs to be stable and predictable if the state’s economic future is going to be bright.

Tom Howard, the Canadian paper company’s director of U.S. communications and government relations, was the speaker Friday morning at an Action Committee of 50 economic forum at Husson College’s Center for Family Business.

Howard said despite the decline in the number of manufacturing jobs in Maine, and especially in the pulp and paper industry, the industry is doing well.

“That really is not the measure of whether or not this business is successful,” Howard said about the number of mills and people they employ.

Howard noted that the productivity of the industry in Maine has gone up. Over 100 years ago, the 25 mills in Maine churned out a total of 350 tons of product every day. Now, though they employ fewer people than they once did, Maine mills manufacture more than 8,000 tons of product each day.

“The industry is in better shape today than it has been in the past,” Howard said.

He said that manufacturing investment in Maine has been an issue because the state has been viewed as not being business friendly. That perception has been alleviated by the Legislature’s recent vote to do away with the state’s tax on business equipment, he said, but it will not go away completely if politicians keep revisiting the issue.

Business executives will be reluctant to spend money on equipment in Maine as long as there are bills aimed at reintroducing the tax, Howard said.

“Don’t keep threatening to fix it and to undo the good the Legislature has done,” he said.

Howard also was critical of the state’s policy on allowing citizen-initiated voting referendums. He said the process can give too much power to a vocal minority.

“It can be a very difficult process to be involved in, especially if it is an emotional issue,” he said.

During a question-and-answer session that came after Howard’s comments, a couple of people suggested that the unpredictability of Maine’s business climate has been a two-way street. Some decisions that have affected Maine workers, such as the trend of selling forestland to separate land-management companies, have been made by private companies, not by the Legislature, they indicated.

Howard said that the best way to address the matter of regulatory predictability is for private firms and public officials to maintain an open dialogue about business issues.

Besides regulatory concerns, there are other challenges facing Maine’s business climate, including the state’s tax burden, work visas for immigrant labor and the cost of health care, according to Howard. Energy costs also are a general concern, though not so much for the Domtar mill in Woodland because the facility has on-site hydropower.

But prices are stabilizing, Howard said, catalog production is increasing, and the overall supply of paper products seems to getting back in line with the demand. There is potential for developing fuel from raw fiber. More pulp and paper companies are specializing in niche markets such as magazine subscription cards and sustainable-certified forest products.

By finding niche markets, pulp and paper companies can offset the shift of commodity manufacturing such as newsprint or office paper to cheaper overseas locations such as China and South America, according to Howard.

“We do have a future,” Howard said of Maine’s pulp and paper industry.