Canada and the US enjoy a long-standing and mutually-beneficial relationship based on cooperation, shared values, and unprecedented levels of commercial activity. In 2010, merchandise trade between Canada and the US was valued at $US 488 billion, making it the largest bilateral trading relationship in the world.1This extraordinary commercial relationship supports millions of jobs in both countries, and boasts some of the most integrated transportation and supply chain systems in the world.
More recently, the unprecedented expansion and diversification of the Asian marketplace continues to significantly alter global trade patterns and supply chains. This phenomenon presents considerable business opportunities for North American firms, and has yielded steady growth in sea-borne trade, specifically “containerized” trade, between North America and Asia. In turn, governments in Canada, the US, and Mexico have responded to this increase in the volume of container traffic through investments in port, rail, and road infrastructure assets throughout the transportation system. The pending completion of the Panama Canal expansion in 2014 to accommodate much larger container ships has also added another layer of complexity to policy and planning decisions. As a result, notwithstanding the recent economic downturn, North America’s East and West Coast seaports continue to be the focus of intense commercial activity, underscoring their critical role in the operation of our integrated and trade-dependent economies.2
Against this backdrop of burgeoning global commerce and expanding trade and economic ties, Canada and the US have a strong history of collaboration in developing (often jointly) innovative programs and policies to address both countries’ shared interests in national security and economic competitiveness. As Prime Minister Harper stated following his December 7, 2011, meeting with President Obama, to announce the Perimeter Security and Economic Competitiveness Action Plan, “Canada has no friend among America’s enemies. What threatens the security and well-being of the United States threatens the security and well-being of Canada. Nevertheless, measures to deal with criminal and terrorist threats can thicken the border, hindering our efforts to create jobs and growth”.3 Continuing close collaboration between Canada and the US in these areas is aimed at ensuring the security of citizens of both countries without impeding the tremendous bilateral trading relationship, particularly the commercial needs of the many Canada-US time sensitive manufacturing and supply chain networks. As President Obama described the shared challenge upon the release of the Perimeter Security and Economic Competitiveness Action Plan, the aim is “to make it easier to conduct the trade and travel that creates jobs … [and] make it harder for those who would do us harm and threaten our security”.4 This collaboration to build upon the cooperative and multi-layered security programs that Canada and the US have instituted, including off-shore cargo screening procedures, at all major North American seaports, airports, and land border crossings makes Canada-US trade and travel networks among the most secure in the world.
In the context of this NOI, the Government of Canada and its many partners, concerned by the inference that US cargo is somehow being “diverted” through Canadian ports given the deeply integrated North American transportation system, welcome the opportunity to dispel any misconceptions regarding Canadian transportation policies and practices. With a particular emphasis on elements vital to the movement of containerized cargo, this submission provides a description of transportation governance in Canada, our system of independent and financially self-sufficient port authorities, our private railway companies, Canada’s approach to public infrastructure investment, as well as our world-class trade security programs. Moreover, the Government of Canada believes that our reliance on market forces to govern the commercial operations of the transportation sector, particularly the movement of containerized cargo, in combination with our natural geographic advantages, make Canada’s transportation supply chains a sound business choice for international shippers and other trade-focused companies.
1 Source: Statistics Canada
2 Additionally, bulk Canadian and US commodities are often exported through each others’ ports (e.g., US coal from the Powder River basin via British Columbia ports and Canadian lumber and potash via US West Coast ports).
3 See: http://www.whitehouse.gov/the-press-office/2011/12/07/statements-president-barack-obama-and-prime-minister-canada-stephen-harp
4 Ibid