The Montreal Economic Institute calls for the elimination of interprovincial trade barriers

Montreal, August 8, 2001 – The Montreal Economic Institute (MEI), in a letter sent today to the federal Industry minister and his provincial counterparts responsible for internal trade, calls for the elimination of the remaining obstacles to trade and mobility between Canadian provinces.

This call to politicians is supported by an Economic Note just released by the MEI. Entitled Why We Need Freer Trade in Canada, this publication was prepared by interprovincial trade expert Robert Knox, a former Executive Director of the interim Internal Trade Secretariat, in collaboration with Michel Kelly-Gagnon, Executive Director of the MEI.

The study reviews problems experienced in several economic sectors due to barriers to interprovincial trade and to labour mobility. As well as showing concrete examples of obstacles that affect businesses and workers, the Economic Note draws attention to the slow pace of progress in several sectors since the Agreement on Internal Trade came into force in 1995.

“The Agreement fails to fulfil its role and attain its objectives,” write the authors. Now that Canada is negotiating a new Free Trade Area of the Americas, it is hard to believe that barriers to trade and workers’s mobility between different regions still exist within Canada. Canada needs a solid economic union if it is to succeed in international markets. “If the Canadian market erodes or discourages domestic productivity then our international competitive advantage will diminish. It becomes more critical than ever that our governments co-operate to reinforce the Canadian union by removing all remaining internal trade barriers,” concludes the study.

In his letter to the federal and provincial ministers responsible for internal trade, Mr. Kelly-Gagnon invites them to attend to this matter and restore the priority it has lost. “Our political leaders must unanimously renew the commitment made in 1995 to create a stable, open internal market in Canada. The federal government and the provinces must put in place the measures needed to remove barriers to trade and mobility. Clear, enforceable commercial rules must be established.”

The MEI also asked the members of the House of Commons Standing Committee on Industry to put this issue on their agenda for the next parliamentary session and to consider the positive role that the federal government can play in dealing with this issue.

The MEI’s initiative follows up the consultations held in 2000-2001 by the Internal Trade Secretariat to which the MEI took part. The Economic Note and the letters sent to the federal and provincial ministers are available in English and in French.

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