Canada marks 150th birthday with internal trade agreement

After decades of complaints about interprovincial barriers, the federal government and provinces have agreed upon a new deal for internal trade. | File photo

Critics say Canada’s new interprovincial trade agreement is marginally better than the old deal, but business owners don’t see it that way.

Late last week the provinces and federal government unveiled what is being called the Canada Free Trade Agreement.

The deal replaces the Agreement on Internal Trade, now more than two decades old, and was designed to align regulations between provinces and remove barriers to labour mobility.

Andrew Coyne, National Post columnist, slammed the deal. He said it contains too many “limitations, caveats and exemptions,” which will continue to obstruct trade within a nation that should have a single and coherent market.

Jonathan Alward, director of provincial affairs for the Canadian Federation of Independent Business in Manitoba, has an opposite view. He said the agreement isn’t a small step forward. It’s a huge leap forward.

“My colleagues from CFIB, across the country, have all been very adamant on that.”

Alward said it will take time, in some cases years, to sort out details of the agreement, but when finalized the Canadian Free Trade Agreement will have a major impact.

“We’re going to see really just an incredibly comprehensive, transparent agreement that’s going to benefit small businesses and big businesses.”

Alward said the deal features three key provisions:

  • mutual recognition
  • negative listing, where open trade is the default
  • an improved dispute resolution process

An example of mutual recognition would be training. If someone earns a welding certificate in Ontario, the Canadian Free Trade Agreement says other provinces should recognize the training.

“If a product or service complies with rules in one province (like) Saskatchewan, it should be considered acceptable in Manitoba, Ontario and onward,” Alward said.

Under the old deal, provinces listed the goods and services eligible for free inter-provincial trade. The new agreement says everything is open for free trade, so provinces must list what they want excluded from the deal.

The CFIB said this provision would increase transparency and boost “the way small businesses will be able to trade.”

Besides the CFIB, farm groups also praised the agreement.

“Canada imports more than $47 billion in food from other countries, much of which is meat, grains and vegetables that Canadian farmers also produce right here at home,” said Dan Mazier, Keystone Agricultural Producers president. “Interprovincial trade barriers have too often made it easier for processors and retailers to import food from another country, than from another province.”

Inconsistent trucking regulations, from province to province, is one obvious barrier to agri-food trade, the Canadian Federation of Agriculture said.

“The agreement is structured to facilitate the flow of goods using an over-arching non-discrimination principle,” said CFA president Ron Bonnett. “This will ensure that technical aspects don’t create unnecessary barriers to trade within our own borders.”

While there is much work left to do, the timing of the agreement is phenomenal, Alward said.

The Canadian Free Trade Agreement is to take effect July 1.

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