In the Beginning
“The proposal now before us [Confederation] is to throw down all barriers between the provinces – to make a citizen of one, citizen of the whole.” – George Brown, 1865
If only current inter-provincial trade regulators were so perceptive.
Our founding fathers might roll over in their graves if they were to see the state of inter-provincial trade today, laughable – or pitiful – to the extent that long haul truck drivers from certain provinces have to change tires before entering another.
Those legislators were vehemently opposed to inter-provincial trade barriers (IPTBs) and included that sentiment in the 1867 Constitution. Section 121 of the Constitution Act states that “All Articles of the Growth, Produce, or Manufacture of any one of the Provinces shall, from and after the Union, be admitted free into each of the other Provinces.”
Legislation today
photo credit Industry Canada
The 1994 Agreement of Inter-Provincial Trade currently governs the movement of people, goods, services and investments within Canada. It is intended to reduce barriers to trade within specific economic sectors, but not much has been done to aid inter-provincial trade in 20 years.
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For Atlantic Canadians doing business across Canada, many of the old hurdles still exist. The AIT does not address problems like the lack of recognition of other provinces’ professional credentials, food safety, truck safety, provincial business registration requirements, and highly restrictive rules for selling alcoholic beverages inter-provincially.
Canadian Federation of Independent Business (CFIB) president Dan Kelley says,
“Doing business with someone in Halifax should be at least as easy for a business in Burnaby as one in Budapest.”
letter to the Premier of PEI from the CFIBAs Canada’s premiers met in Charlottetown last week, the CFIB urged them to use the Canada-EU free trade agreement as a model for modernizing trade within Canada.
“When it comes to internal trade,” the CFIB proposed, “… the current system is outdated and imposes unnecessary barriers on small businesses. In many cases, it is often easier to trade overseas than it is to trade with other provinces within Canada. CFIB recommends provincial leaders improve inter-provincial trade by empowering their trade ministers to move forward on negotiating a more open market within Canada.”
“There is a lot of red tape involved in dealing with other provinces, and that’s a big disincentive to growth,” notes CFIB executive vice-president Laura Jones. “With international trade barriers coming down, our internal trade agreements need to keep up. This is a relatively easy way to boost the economy, and should be a top priority for every province.”
There were modest signs of movement last week in Charlottetown, but a great deal of work needs to be done to implement an inter-provincial trade agreement that benefits residents of all provinces and territories.
Importantly, the premiers agreed to undertake a comprehensive review of AIT.
Federal Industry Minister James Moore has been campaigning across Canada and wants to see “a massive change to the AIT.” He notes that federal governments collectively have negotiated more than 40 international trade agreements since ATI came into effect and says,
” It’s just patently ludicrous for us to continue and to not make sure that we are taking full advantage of all of Canada’s economic opportunities for Canadians.”
What now?
“Every rule that makes it harder to move to, or sell to, another province drives home that our “fellow” Canadians regard us as foreigners” – MacDonald-Laurier-Institute
In 2010, Brian Lee Crowley, Robert Knox and John Robson wrote Citizen of One, Citizen of the Whole for the MacDonald-Laurier-Institute (think-tank) publication True North.
Jordi Morgan, photo contributed
Morgan says the barriers go beyond “business” to impact workers directly. He says that “A CFIB report released last year highlighted barriers in the area of skilled trades. Of all the trades certified in Atlantic Canada, there is not a single example of apprenticeship requirements being the same in all four provinces.”
Morgan also says that one province’s investment in inter-provincial business benefits the entire region by stimulating economic activity: “With a population of a little more than 2 million, Atlantic Canada needs to allow not only a freer flow of goods and services, but a larger pool and freer flow of private capital. The question to be asked is why we should have to restrict out-of-province investment in our home provinces?”
It makes no sense for Canada to provide greater benefits to our trading partners than to companies, workers and consumers within our country.
-John Manley, President and CEO, Canadian Council of Chief Executives, June 17, 2014
percentage of income going to top 10% of earners per province/territory
But Canadians need to be realistic. What if we’re not talking about beer, but pesticides, fracking, or chemical waste? Should any province be forced to do what others are doing, if it hurts their bottom line? There will always be exceptions. Finding a happy medium may prove to be a gargantuan task.
