Lost trade with U.S. prompts Canada to seek other markets
Vancouver Sun, Canada
Lost trade with U.S. prompts Canada to seek other markets
Despite enhanced security measures aimed at creating a ’smart border,’ blockages cost Canada $19.1 billion a year in lost trade and tourism
By Barbara Yaffe, Vancouver Sun
22 August 2012
Eleven years after the 9/11 debacle, the Canada-U.S. border linking the world’s two most friendly countries remains a debilitating choke point.
Last weekend, driving down to Seattle, early-morning line-ups at the Peace Arch customs crossing appeared as long as ever with waits of about 50 minutes to gain access to the land of the free and home of the brave.
This, despite herculean efforts in the past decade expended on a flotilla of trusted traveller programs, as well as significant upgrades to B.C.-Washington border crossings in advance of Vancouver’s 2010 Olympics.
"The current system of border thickening," decrees a just-released study on the boggeddown border, "constitutes a serious threat to long-term economic growth in Canada."
The Fraser Institute study by Simon Fraser University political scientist Alexander Moens and researcher Nachum Gabler says the border blockage is costing Canada $19.1 billion a year in lost trade and tourism.
That’s big money - almost equivalent to Canada’s entire annual defence budget.
Canadian exports to the U.S. back in 2000 accounted for 86 per cent of the total. These days 74.9 per cent of our exports go south.
Meanwhile same-day and overnight trips by Americans visiting Canada between 2000 and 2009 dropped by 53 per cent, with a concomitant loss of an estimated $7 billion in tourist-based receipts.
No doubt some of that decline is due to the 2008 recession and increased value of the Canadian dollar.
Moens and Gabler document how, despite billions in spending by Canada on things such as enhanced security, new border infrastructure and trusted traveller and commercial shipper programs to create a "smart" border, the 49th parallel remains pretty dumb.
The report concludes that a Beyond the Border accord signed last December by Ottawa and Washington, D.C., to be implemented over three years, offers hope for improvement.
But the authors argue that henceforth border security costs need to be assessed against measurable benefits to test their effectiveness and value, with results released to the public.
"We need to hold governments accountable in terms of costs and savings."
The Conservative government knows it’s facing an uphill battle and that increasingly it is crucial to diversify Canadian export markets.
Prime Minister Stephen Harper, ironically, has picked up the torch from Liberal PM Pierre Elliott Trudeau who in the 1980s advocated for a more diversified trade agenda, implementing the metric measurement system the previous decade to ease such a project.
These days, Conservative ministers are jetting to an assortment of countries trying to pocket trade and foreign investment deals for Canada.
Right now negotiations are underway for free trade agreements with India, Korea and Singapore.
Ottawa also is working to finalize a trade agreement with the European Union and is poised to join trans-Pacific Partnership trade talks.
The feds also are studying the possibility of a Canada-Japan economic partnership.
International Trade Minister Ed Fast is spending the last two weeks of August holding cross-Canada consultations to update the government’s global commerce trade strategy, launched five years ago.
Fast is set to meet Friday in Vancouver with industry and business leaders.
The world has become a global village and Canada is joining a long list of countries keen to trade with one another. The timing is propitious because Americans were forever changed by the al-Qaida attacks on their soil; their security-first orientation is not likely to change.
And so, while the effort to nurture a smart border at Canada-U.S. crossings remains a worthy objective, this country’s aggressive plan for trade diversification reflects smart strategy.
