The Importance of Modern Transportation Infrastructure

“We know that upgrading our nation’s infrastructure is vital to our economy and our future competitiveness. And that's why the President has laid out a bold new plan for rebuilding and modernizing America's transportation infrastructure that will bring jobs to our economy now and increase our nation's growth and productivity over the long-term.”18 – US Secretary of Transportation Ray LaHood, October 11, 2010

The Government of Canada, like that of the US, has consistently identified the importance of modern and efficient transportation and trade-related infrastructure as essential to building a strong economy and improving the quality of life for its citizens. The most recent example of this commitment is embodied in the $CDN 33 billion Building Canada Plan,19 a seven-year (2007-2014) program that has supported infrastructure investments in major highways, urban transportation projects, and key border crossings. This Plan represents the largest Government of Canada investment in infrastructure since World War II.

Similarly, in 2009, the US undertook significant investments in transportation infrastructure as part of the $US 787 billion American Recovery and Reinvestment Act, and its component Transportation Investment Generating Economic Recovery (TIGER) multimodal grant programs. During the second round of TIGER funding, in 2010, $US 600 million was made available for infrastructure projects in four areas: (i) highways and bridges, (ii) transit, (ii) rail, and (iv) ports. Receiving a total of approximately $US 95 million, the percentage of funding allocated to US seaports under TIGER II was more than double the amount ports had received during the first round of TIGER funding.20 Most recently, on December 15, 2011, the US announced the 46 transportation projects that will receive a total of $511 million from under the third round of the TIGER program, and which include freight, port, and rail expansions. More broadly, Secretary LaHood has been very clear on the importance of port-related investments to US economic competitiveness, and on the Department of Transportation’s efforts “to fund ports, to fund roads that lead in and out of ports or fund rail lines that lead in and out of ports, to relieve congestion [and] enhance, really, economic development in a community and create jobs.”21

Similarly attuned to the competitive challenges of the global trading environment, the emergence of global supply chains as the preeminent business model, and the corresponding growth in containerized trade between Asia and North America, Canada adopted a strategic and collaborative approach to develop and launch the Asia-Pacific Gateway and Trade Corridor Initiative (APGCI) and the National Policy Framework for Strategic Gateways and Trade Corridors.

Asia-Pacific Gateway and Corridor Initiative

Launched in 2006, the APGCI is an integrated set of investment and policy measures focused on enhancing Canada’s strategic trade and transportation infrastructure to better accommodate the increasing trade volumes with the Asia-Pacific Region.22

The APGCI consists of strategic transportation infrastructure projects throughout western Canada, specifically to support the region’s principal road and intermodal connections, key border crossings, and major Canadian ports. Approximately $CDN 1.4 billion in federal investments in public infrastructure have been either announced or completed including road/rail grade separations, new and expanded bridges, and the twinning of important sections of the Trans-Canada Highway. Key to the success of many APCGI infrastructure projects has been the Government of Canada’s commitment to a systems-based approach to maximize the impacts of investments. By using this approach, some 47 projects have been announced totaling approximately $CDN 3.5 billion.

In addition to infrastructure investments, the APGCI has also included extensive public engagement, important regulatory and operational reforms, and extensive analyses of the region’s transportation network to better prepare for future transportation and trade pressures. In this regard, the APGCI has been able to build on, and learn from, many previous accomplishments by private-sector stakeholders and provincial and municipal governments.

One notable policy-related achievement was the successful amalgamation of British Columbia’s three Lower Mainland port authorities into a single organization, Port Metro Vancouver, in early 2008. This strategic amalgamation of port facilities reduced operational overhead and improved the efficiency of the new, integrated authority. From a private sector perspective, dealing with a single administrative apparatus also makes the Port a more attractive option for international and domestic shipping companies looking to access the North American marketplace.

National Policy Framework for Strategic Gateways and Trade Corridors

Following the launch of the APGCI, the Government of Canada also released theNational Policy Framework for Strategic Gateways and Trade Corridors in 2007. The Framework was developed to enhance the global competitiveness of the Canadian economy by providing focus and direction for the development of additional gateway initiatives.

With this goal in mind, any gateway or corridor strategy advanced under the Framework would serve to enhance the multimodal integration of major transportation systems, as well as their efficiency, safety, security, and sustainability. The Framework and the strategies it would support could also be tailored to geographic, trade, and transportation opportunities in different regions of Canada. Like the APGCI, the Framework emphasized the importance of rigorous analysis and long-term planning, and partnerships among governments and between the public and private sectors.

As was intended, the Framework helped to underpin the development of Canada’s Continental and Atlantic Gateways and also served to guide investment decisions under the $CDN 2.1 billion Gateways and Border Crossings Fund, a component of the Building Canada Plan.

These policy initiatives and their targeted infrastructure investments have helped many businesses to harness the economic potential of increased trade between North America and Asia. Canada’s approach has not only garnered the attention of many in the Asian business community, it has also been cited by US government officials and US ports (including the Executive Director of the Port of Los Angeles) as an example of sound and strategic public policy to be emulated.

"I think what the Canadians have done is a best practice that we can learn from. The way they came together and really unified the national and provincial governments to support port development is a best practice.”23

Recognized for these successes, Canada has been open and transparent about its strategic approach to gateways development and willing to share its best practices worldwide, welcoming in particular the opportunity to collaborate with the US to further enhance the competitive advantage of the North American platform.

 

 

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18 See: http://www.whitehouse.gov/the-press-office/2010/10/11/president-obama-holds-meeting-infrastructure-investment-new-report-shows
19 See: http://www.infrastructure.gc.ca/prog/bcp-pcc-eng.html
20 See: http://www.aapa-ports.org/Press/PRdetail.cfm?itemnumber=17667
21 See: http://www.joc.com/portsterminals/lahood-reconfirms-backing-port-upgrades
22 See: http://www.asiapacificgateway.gc.ca/apgci.html
23 See: http://www.americanshipper.com/Main/News/Knatz_US_at_fault_for_Canada_diversion__47410.aspx?taxonomy