By DREW FAGAN
OTTAWA BUREAU CHIEF
Monday, April 26, 2004
Two major Canadian and U.S. business organizations are joining forces to press Paul Martin and George W. Bush to kick-start a "NAFTA-plus" agenda at their White House meeting this Friday, a step the Prime Minister is considering.
"This agenda is more important to Canada than it is to the United States, and therefore the only way it can be advanced is through fervent Canadian leadership," a senior government official said. "This is a great initiative that can strengthen Canada."
In a letter to both leaders to be released today, the Canadian Manufacturers and Exporters and the U.S. National Association of Manufacturers suggest that the two countries must work together to facilitate North American commerce in the face of the competitive threat posed by low-cost producers in China and other developing countries. The integration of key Canadian and U.S. industries, the letter states, means that success or failure in one country inevitably affects the other.
"To help address these common challenges, we recommend that you support a joint initiative that would not only seek to further reduce barriers to Canada-U.S. trade and investment but would also encourage policy reforms that improve the competitiveness of North American industry as a whole."
The two groups' proposal generally dovetails with suggestions the Liberal government is considering to co-ordinate trade and regulatory policy more closely and allow the freer cross-border relocation of businesspeople.
Border delays cost as much as 10 per cent of overall trade, the two organizations estimate, hurting job creation and undercutting North American companies' competitiveness. Transportation bottlenecks need to be addressed, they say, and the two governments need to better co-ordinate regulations so the private sector doesn't have to duplicate efforts on both sides of the border.
In a recent speech in Washington, Liberal MP Scott Brison, parliamentary secretary to the Prime Minister for Canada-U.S. relations, made similar arguments.
There is now a debate within the Liberal government as to how hard to press this agenda. The logic of closer economic integration is generally accepted, but there is concern that it would be politically risky even to broach the issue this Friday, considering Mr. Bush's deep unpopularity in Canada.
Mad-cow disease is certain to be front and centre at the White House meeting, and there are new signs that the two countries may slowly be moving toward an open border. The Canadian Food Inspection Agency quietly changed its import rules last Friday to permit a wider range of meat products to be shipped from the United States. This followed similar action days earlier by U.S. regulators. Cattle exports remain restricted, though, and it may still be months before the border reopens. But Ottawa is hoping that Mr. Bush, who can't open the border unilaterally, will signal his willingness to put some political weight behind a resumption of cattle trade.