Major business coalition makes latest border recommendations

OTTAWA, (July 26, 2005) — One of the largest business coalitions in Canadian history has released its fourth report on the efficiency of the Canada-U.S. border since 9-11.

The Coalition for Secure and Trade-Efficient Borders was formed by over 55 Canadian business associations and individual companies to help the federal government successfully deal with U.S. border and security issues. Steered by the Canadian Manufacturers and Exporters, the Canadian Chamber of Commerce, and the Canadian Federation of Independent Business, the group’s goal is to recommend measures to facilitate the passage of low-risk goods across Canada’s borders; to recommend ways to strengthen Canadian security, immigration, and border management; and to increase cooperation between Canada and the U.S. to prevent the entry of terrorists and illegal goods into each country.

The Coalition released its initial report, Rethinking Our Borders: Statement of Principles on November 1, 2001, which outlined the approach that should be taken to improve security while facilitating trade. Since then, progress has been made in getting the border “right” since 9/11, but as the new report — Rethinking our Borders: A New North American Partnership — highlights, the 49th parallel remains a barrier to trade and investment as well as an impediment to international competitiveness.

This fourth report is also one that has witnessed a rapid increase in the introduction of regulatory initiatives. Today, there are at least 44 agencies between the two countries with a level of jurisdiction over the shared border. The results are troubling, says the report, and strained logistics at the border has become a competitive disadvantage for North American business.

For one thing, customs rules are more complex today than ever before and are being enforced differently by different inspectors at different crossings.

“Notwithstanding a streamlining in the U.S. and Canada with the creation of the Department of Homeland Security (DHS) and Canada Border Services Agency (CBSA) respectively, the regulatory regime has added complexity to border processes,” the report notes. “Individually, each initiative and program is well-founded and supported. However, the cumulative implementation of these initiatives and programs at the Canada-U.S. border has produced a ‘layering’ of security requirements for North American business.”

The overlapping paperwork and information requirements for border inspections are increasingly onerous and expensive for carriers and shippers, states the report. The cost of doing cross-border business has especially affected just-in-time freight — specifically the auto industry. In fact, the coalition predicts the complex new rules and burdensome paperwork add an extra $800 to the price of each vehicle produced in North America.

“Given that over 40 per cent of Canada-U.S. trade is intra-company and a further 30 per cent is identified as originating from an entity within a secure supply chain, the Coalition is questioning the necessity of these costs and is issuing an alert to both the Canadian and U.S. governments,” it states. “It is time to shift our focus to securing the external Canada-U.S. perimeter and achieving the goal of a seamless Canada-U.S. border for known low-security-risk goods and people.”

The coalition also asks why FAST is not available or is limited at several key crossings. “The coalition recommends the Canadian and American governments ensure that all existing primary lanes, including FAST and NEXUS lanes, are fully staffed during critical high-traffic-volume periods.”

The Coalition also supports the integration, cross accreditation and/or designation of Canadian and U.S. Customs agencies and officers, and the establishment of shared facilities located on either side of the border.

However, the coalition is concerned that Canada Border Services Agency does not currently have the IT capacity required to deliver programs like Advance Commercial Information (ACI) within the required timeframe. “It is critical that our government provide the resources necessary to ensure that CBSA has the IT capacity needed to implement customs programs as required in conjunction with the U.S. of travel at all points of entry,” the report states.

“The Coalition urges CBSA to commit to a specific date for the implementation of ACI for all modes, especially highway, ideally by the end of 2006. ”

Like just about every other business group that depends on U.S. trade these days, the coalition is urging governments to expedite infrastructure enhancements at border crossings — specifically at Detroit-Windsor, which experts say is the international gateway most in need of a new crossing.

“It is critical that senior levels of government aggressively pursue jointly developed and implemented permanent solutions over the next five years,” the report says. “While decisions on infrastructure improvements are subject to multi-tiered and often overlapping and conflicting jurisdictional mandates, the Coalition urges both federal governments to take the reins, follow through with previous commitments, and establish a new border crossing in the Windsor-Detroit corridor.”

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