20 September 2004

Fix border or risk investment: Emerson

The following article is excerpted from the 20 September 2004 edition of “globeandmail.com”.

Ottawa must make it easier, cheaper and more secure for exporters to transport goods across the Canada-U.S. border or risk losing investment, says Industry Minister David Emerson.

"We need a broad-based, frontal assault on border risk," Mr. Emerson is to tell the Canadian Chamber of Commerce today in a speech in Calgary. "We need to thoroughly understand it and we need to reduce wherever we can." A copy of the speech, his first major address as industry minister, was obtained in advance by The Globe and Mail.

The chamber, which is voting on a number of resolutions as part of its annual meeting today, supports Mr. Emerson's view and hopes he takes fast action. It particularly wants him to address the complex web of regulations governing the border, which it sees as the chief problem in trying to move goods and people efficiently.

Canadian exporters have traditionally enjoyed easy access to the lucrative U.S. market, Mr. Emerson says, but that changed since the terrorist attacks of Sept. 11, 2001. Differences over softwood lumber, bovine spongiform encephalopathy -- mad-cow disease -- and rapidly fluctuating currency rates have also made trade between the two neighbours more complicated over the past few years.

"You start to realize that border risk, as I like to call it, has become a critical challenge for Canada," Mr. Emerson is to say in his speech.

The federal Liberals have been trying to improve both security and trade flow at the border since the Sept. 11 attacks. Opposition MPs have said the government has done a poor job on both fronts.

Mr. Emerson's speech doesn't include a specific plan to unclog the border, but during an interview last month he said Canada needs smarter industrial regulations, better rail and sea links, and a more aggressive approach to trade disputes.

Canada should use the World Trade Organization more in an effort to improve the North American free-trade agreement and ensure access to markets, he said. The trade pact allows "spurious and superficial" allegations to block trade and cause hardship, he said at that time. "The NAFTA framework has got a few glitches in it."

Nancy Hughes Anthony, president and chief executive officer of the Canadian Chamber of Commerce, said the soon-to-be-published recommendations of the government's external advisory committee on "smart regulation" are something Mr. Emerson should embrace.

"If you want to be the champion of smart regulation, Mr. Emerson, it would be well received by the business community," Ms. Hughes Anthony said. She blames a "plethora of regulations," many in the United States, for border problems.

Mr. Emerson, a former executive in the forestry and bank industries, is fast becoming an important advocate for economic growth in a federal cabinet that has tacked left since Paul Martin became Prime Minister late last year….

In describing Canada as a "highly trade-dependent economy, bobbing along in a turbulent sea of global change," he also says the country must be more competitive than -- not as good as -- its rivals….