Lee Richardson, MP Speaks at the 2010 International Law Conference

May 07, 2010

2010 International Law Conference: The Future of Canada-U.S. Cross Border Relations

The following is a speech given by Lee Richardson, MP at the 2010 Canadian Bar Association International Law Conference in Vancouver, British Colombia

Vancouver- Canada and the United States enjoy the largest trading partnership in the world as well as an excellent and unparalleled bilateral relationship forged by shared geography, common values and interests, vibrant social connections and multi-layered economic ties. The result is a long-standing and mutually beneficial partnership.
The continuous and open exchange of views between Canada and the U.S., which include frequent bilateral interactions between our Prime Minister and the US President, is a hallmark of the deep and diverse relationship our two countries share, as we continue to work together to advance shared goals and address challenges at home and abroad.
Canada and the US have a very close relationship, but no relationship is free of problems. Jobs, prosperity and opportunity on both sides have depended on the continuation and improvement of this relationship.

The future of the Canada-US relationship will bring challenges that present opportunities, both positive and negative.
Currently there are two main sets of border issues. One is the actual bottlenecks at the border: the physical infrastructure and the need to have pre-clearance and other types of measures that will help facilitate trade at the border. The second is the new compliance requirements that companies must meet in order to cross the border.
Other recent impediments to the future of Canada-US trade include Country of Origin Labelling (COOL) and Buy American.
Despite these obstacles, the Canada-US relationship is fruitful.
As you’ve heard, in 2009 more than $1.6 billion in goods and services passed over the border every day. Canada bought nearly five times more goods from the United States than from China, and Canada is the top merchandise export market for 35 of the 50 states and ranked in the top three in another 12 states.
This level of trade is achieved through the North American Free Trade Agreement, NAFTA, an agreement unlike any other.
The Canada-US relationship has been strengthened as of late, our Government has actively and successfully engaged the Obama Administration during its first fifteen months. There have been over fifty ministerial visits to Washington during that period.
Members of the House of Commons Standing Committee on International Trade meet regularly with our counterparts and colleagues in the US Congress and Senate.
Our discussions of late evolve around the “thickening” of the Canada-US border. This development is in large part a reflection of a series of measures introduced by the Department of Homeland Security (DHS) and the US Department of Agriculture (USDA), all in the name of enhanced national security and regulation. These measures include everything from supply chain security programs to new electronic means of submitting information to border agencies, to inspection fees for agricultural products and to the cost of multiple security cards for truck drivers.
On top of the increased security and regulatory requirements along the border is the issue of border infrastructure. There has been a longstanding need for increased capacity at border crossings, both in terms of border facilities, as well as transportation infrastructure leading up to crossing points. The existing road and rail linkages between the two countries were not designed to accommodate the present level of trade between Canada and the US.

Vehicle crossing at every border point is only going to get busier in the years ahead.  At the Detroit-Windsor border vehicle traffic set is to double in the next 30 years — and truck traffic set to triple over the same timeframe.

Because of the high degree of integration between the Canadian and US economies, the effect of increased compliance requirements at the border is to impede trade between the two countries and ultimately cost jobs on both sides. During the global economic downturn, our efforts sought to make the North American economy as competitive and efficient as possible, and not add new burdens and unnecessary costs. Doing otherwise would prolong the recession and delay or limit any economic recovery. It is critical that we continue to work together to manage our border in a way that enhances security and public safety while facilitating the trade and travel that connects our two countries.
The potential implications of Country of Origin Labelling, (COOL) on agricultural production in both Canada and the US are considerable. COOL requires that beef, lamb, pork, fish, peanuts and perishable agricultural commodities be labelled to show the country in which they originated. The provisions outlined in COOL lead some US slaughterhouses to announce that they would no longer purchase animals born outside the US, while others stated they would only purchase Canadian animals on specified days. It was estimated that implementing COOL would cost the US economy $3.9 billion.
The “Buy American” provisions concerned Canadians as they appeared to embody a general trend of rising US protectionism. These provisions require that any iron, steel and manufactured goods to be used in a project financed by the US stimulus package be produced in the United States. The “Buy American” provisions in the US Recovery Act threatened the integrated supply chains that we’ve created together over the decades, hurting us both.
The Canadian Government responded by successfully negotiating the Canada-US Agreement on Government Procurement which came into force on February 16, 2010. The agreement stipulated that there was to be an exchange of permanent commitments under the World Trade Organization’s (WTO’s) Agreements on Government Procurement (GPA), as well as a temporary agreement, lasting until September 2011, providing mutual access to certain state, provincial and municipal infrastructure projects and a pledge to explore the scope for further negotiations and an agreement to expedited consultations regarding future procurement-related matters.

More than ever trade and security can go hand-in-hand, companies on both sides of the border realize this and have taken significant step to streamlined their respective businesses. Today around one third of all goods shipped over the border have already been inspected and cleared by customs officials prior to arriving at the border with an increasing amount of drivers going through security clearances and background checks.

The increase of enhanced driver’s licences, for example has enhanced competitiveness and is helping in our efforts to work with the US and Mexico to make the North American Free Trade Agreement even more effective.


According to the Canadian Chamber of Commerce; “since the implementation of the Canada-U.S. Free Trade Agreement in 1989, approximately one-third of bilateral shipments are deliveries of goods and materials between companies. During this period, a North American economic space has evolved – one that has provided us with a strong platform on which to compete in an increasingly competitive global marketplace. Both countries have benefitted immensely by being good neighbours.

But in today’s global economy, a sophisticated trade relationship needs to go beyond tariff reduction and elimination. It also needs to tackle non-tariff barriers. That’s why we’re working with the US to bring our regulations into line, for example, and deal with rules of origin issues.

These are critical factors in creating a competitive, business and trade-friendly commercial space — one that can draw business activity and investment to both of our countries in the years ahead.

It is undeniable that the benefits of the close Canada-US relationship far outweigh the negative. And we’re now engaged in our biggest trade negotiations since the North American Free Trade Agreement — negotiations with the European Union towards a Comprehensive Economic and Trade Agreement.

Any effort that brings more business to Canada will no doubt have a positive impact on trade flows throughout North America.

It will increase business activity and make our continental commercial platform more competitive and attractive to global businesses and investment.

These are the realities of International Trade in 2010. The relationship between Canada and the United States is politically, socially and economically strong, to the benefit of both countries.