By Deron Bilous, Senior Vice President, former Alberta Minister of Economic Development and Trade
The threat of tariffs from Canada’s largest trading partner has lit a fire under Canada to rethink our national economy.
Provinces need to seize this opportunity while the iron is hot. Every province in Canada has a list of regulations that it could eliminate, improve, or harmonize. Any delay could squander the fleeting chance for trade harmony that we have in front of us.
Although US President Donald Trump has given Canada a 30-day reprieve from punishing 25 per cent tariffs, the ongoing threat looming over us is a reminder that we can no longer rely on one trading partner to control our economic future.
A significant part of our pan-Canadian response must be to improve trade access to markets within our borders as well as around the world.
When I served as Economic Development and Trade Minister in Alberta in 2017, I helped negotiate the Canada Free Trade Agreement (CFTA) and was Alberta’s signatory. The CFTA is an intergovernmental trade agreement signed by the federal government and all 13 provinces and territories that entered into force in July 2017.
While that agreement was a significant improvement from the Agreement on Internal Trade (AIT) that it replaced, and I am proud of the work my colleagues from across the country did on this issue, we knew at the time that there was more to do.
Given the threat that is still hanging over our collective heads, now is the time for aggressive action and to overhaul the eight-year-old trade agreement. We need to move expeditiously to make changes to the CFTA that open up market access by reducing friction and barriers that slow the flow of goods from province to province.
Now is the time for action. Areas the provinces can quickly remove barriers include:
- Harmonizing regulations and resolving licensing differences for professionals and trades
- Aligning agricultural standards
- Reducing restrictions on interprovincial sale of liquor and dairy
- Creating uniform transportation standards including truck size
- Reducing regulations that limit the movement of energy across the country
- Reducing barriers to labour mobility
We don’t need another work plan or agreement to meet. We only need to look as far as the New West Partnership (NWP) between Alberta, British Columbia, Saskatchewan, and Manitoba – the most robust trade agreement in Canada.
The architecture of this agreement covers most sectors including trade, investment and labour mobility.
There are two fundamental provisions in the NWP. The first is mutual recognition, namely what is good in your province is good in mine. The second is the Negative Listing Agreement, meaning that everything is covered unless it is specifically excluded. The NWP has a short list of exceptions and has led to a massive increase in the flow of goods and services across the West.
We should look to replicate the fundamentals of the NWP across the country.
Improving market access also includes making key strategic investments in privately and publicly owned infrastructure that is critical to interprovincial trade.
Critically, Canada has the energy reserves it needs to be self-sufficient, covering both renewable and non-renewable resources.
However, there remain significant regulatory and physical barriers that prevent all Canadian consumers from benefitting from Canadian energy. The work to break down the silos between our provincial energy systems is long overdue.
Interprovincial trade harmonization will not solve all our problems. We must also seek out new international markets, put in place strong countermeasures to respond to any foreign trade action, and promote positive buy-local initiatives so we can be our own best customers.
Does your business or organization share an interest in reducing Canada’s internal trade barriers? Counsel’s multi-jurisdictional team of government relations professionals can help. Get in touch with us to discuss strategies for harmonizing interprovincial trade.
