North America’s Transportation Corridors

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An edited version of these remarks to the North America;s Corridor Coalition Inc, appeared in the Winnipeg Free Press, September 25, 2012.

As the historical gateway to the West, from the fort at the Forks to today’s CentrePort and the new international Airport, Winnipeggers instinctively appreciate the importance of trade and the role of transportation.

Trade is increasingly based on efficient production. That demands the just-in-time arrival of a part, a piece of equipment, or a person who can quickly fix things. Investment decisions are calculated through production chain dynamics and the proximity to resources and markets.

Improving transportation for the flow of people and movement of goods is the focus of this week’s meeting in Winnipeg of the North American Corridor Coalition (NASCO), the tri-national association of heartland states and provinces, cities and business that support over a trillion dollars in continental commerce.

The infrastructure that serves our production chains – our roads and rail lines, our sea and airports, our power grids and pipelines that fuel our factories and offices – must link seamlessly. Get it right and we all prosper. This is the logic of CentrePort.

The big idea that binds NASCO is North America as a production platform that draws on pooled capital, resources and labour to serve a market of 450 million consumers.

It’s not new – it was a key argument behind first the Canada-US Free Trade Agreement and then the North American Free Trade Agreement. Those agreements ushered in a decade of prosperity and the World Bank estimates that North America has achieved an integration level of 50 percent. But for the European Union the integration level is 73 percent and in Asia it is 53 percent. We have to do better.

Today, Canada is moving forward again through a series of initiatives designed to both improve our continental platform and open new opportunities abroad.

We are in the midst of over fifty trade and investment negotiations.

A comprehensive agreement with the European Union should be ready by Christmas. We are on the verge of admission into the Trans Pacific Partnership. We just signed an investment agreement with China and we are now looking at a bigger deal.

But, for Canada, our best market, and the biggest market in the world, is the United States. Last December, Prime Minister Harper and President Obama created a framework agreement around two initiatives: Beyond the Border and the creation of a Regulatory Cooperation Council.

Beyond the Borders is making progress in creating a new code that should speed along the legitimate travel of people and goods. The Regulatory Cooperation Council is designed to lift the ‘tyranny of small bilateral differences’ that currently apply to everything from our orange juice to the Cheerios that US Ambassador Jacobson eats for breakfast.

The critical test in these initiatives will depend on an attitudinal change in those who administer our borders. The current approach puts the emphasis on enforcement and security with zero tolerance. That mindset must change to reflect the principle of risk management and to recognize that expediting the flow of people and products is vital to our economic security.

Business leadership is ahead of the curve. They already design their production on continental lines and through global supply chains.

Last week, in Washington, members of the Canadian Council of Chief Executives, led by chair Hartley Richardson and CEO John Manley, met with the Business Round Table and Mexico’s Consejo Mexicano de Hombres de Negocios to discuss North American competitiveness, trade, and energy. They endorsed their nations’ membership in the TPP, and encouraged governments to move on border access and regulatory reform and to smooth the permitting of shared energy projects and infrastructure.

Experience also demonstrates that progress depends on regional experimentation and pilot projects – like the smart driver’s license that expedites the flow of travellers across our borders. What seems impossible when viewed from our federal capitals, Washington or Ottawa or Mexico City, is often quite doable from a local or regional lens.

The evolution of our ‘hidden wiring’ – our premiers and governors with legislators from our 96 states and provinces all of whom either enjoy or share constitutional responsibilities for trade, transportation, resources, education and the environment – has been vital to both continental integration and opportunities abroad, as Premier Selinger demonstrated earlier this month when he joined fellow premiers in a trade mission to Asia.

The catalysts for action are the cross-border organizations, especially those with a functional mandate like NASCO. They keep the ball moving forward by bringing the players together, through generating new ideas and by maintaining focus on what needs to be done,

We must avoid the siren call of protectionism. When borders become choke-points, production lines slow and the prosperity of all partners is diminished. Beggar-thy-neighbor policies like ‘Buy America’ or ‘Buy Canada’ cost taxpayers and do little to protect jobs.

Protectionism is rooted in the false belief that we can’t compete. It is a defeatism that defies our collective heritage. The North American story is built on beating the odds through a can-do attitude and communities working across borders for mutual prosperity.

The North American idea is ready to go the next step. It is not the EU model but rather a North American idea: three sovereign nations committed to a platform based on shared production, access to markets, and making efficient use of our labour and resources.