Canada Should Launch New Bilateral Trade Initiative with the US: C.D. Howe Institute

Canadian trade policy is preoccupied with yesterday’s priorities: bilateral trade agreements with minor partners and multilateral negotiations that provide scant benefit, while ignoring pressing problems in Canada’s most important trading relationship. Tempting as it is to blame the political caution of a minority government and wait for political fortunes to change, the problem is deeper and of longer standing. Canadian trade policy has become detached from its economic moorings.

Canada needs a trade policy that recognizes the increasing importance of global value chains, and the critical role of Canada-US commercial and regulatory integration in gaining full benefit from their exploitation, according to a study released today by the C.D. Howe Institute. In Navigating New Trade Routes: The Rise of Value Chains and the Challenges for Canadian Trade Policy, leading trade policy authorities Bill Dymond and Michael Hart argue that Canadian trade policy is at sea, and needs to reflect the new realities of international trade. They conclude that Canada needs to move decisively to pursue a bilateral initiative with the United States and outline the components of the initiative, including a new border regime, a joint regulatory agenda, and the creation of the institutions and decision-making procedures required to implement it. Download the report (PDF format).