If you’re qualified in one province, you should be good anywhere

Few Canadians are aware that it’s often easier for Canadian businesses to sell their goods in a neighbouring country, than in a neighbouring province.

And while premiers in all provinces and territories have voiced support for eliminating these barriers, progress has been slow, as it would seem to require lengthy negotiations and a tit-for-tat approach.

Fortunately, there looks to be a promising solution for putting all that behind us: the Free Trade and Mobility Within Canada Act, a new bill proposed by Nova Scotia Premier Tim Houston.

To better understand how this bill is a game-changer, we first need to understand how these barriers to interprovincial trade operate. It’s easiest to think of them as coming in three different kinds.

The first kind is what we call codified barriers, and they are arguably the easiest ones to get rid of.

When the provinces and territories signed the Canadian Free Trade Agreement back in 2017, each pledged to allow trade to flow freely within Canada, albeit with a few exceptions ranging from things like softwood lumber in Quebec to fisheries in Saskatchewan.

These were the obstacles at play in last year’s short trade spat over wine between Alberta and British Columbia.

Some provinces have made good efforts at reducing them. Alberta started off with 27 in 2017 and is now down to just 8. Others have made little to no effort on that front–we’re looking at you, Quebec.

Second come the labour mobility barriers, which can be seen in the form of professional certifications that aren’t recognized across provincial borders.

For example, if a paramedic from Saskatchewan wanted to move to Alberta, they’d have to undergo additional training before they could practice their trade in their new home province. The same goes for licensed practical nurses from Quebec.

The third kind is the barriers in the form of regulatory differences. These are the costliest as well as the most difficult to get rid of.

Few Canadians are aware that it’s often easier for Canadian businesses to sell their goods in a neighbouring country, than in a neighbouring province. A new Nova Scotia law could change all that – if adopted across the country.

Take trucking for instance. Every province has its own requirements regarding truck-length, load limits, types of tires, etc. It’s estimated that these different regulations are responsible for adding 8.3 per cent to the cost of transporting goods between provinces.

This complex web of regulations is part of why, despite a longstanding commitment from premiers to remove interprovincial trade barriers, progress has remained glacial. While everybody agrees on the need to harmonize these rules, each province and territory is pushing for its own regulatory regime to become the national standard.

As the politicians and bureaucrats quibble over details, Canadian consumers and businesses are forced to pay the price.

Premier Houston’s approach is different in that the bill he’s proposing would allow goods and services from other provinces to flow into Nova Scotia without the need for further bureaucratic hurdles and tests.

If his bill is as ambitious as pitched, it would mean Nova Scotia would recognize that regulations from other Canadian provinces are stringent enough that Nova Scotians should be able to access their goods and services freely.

The only condition the bill would impose is that, for a province to be able to trade freely with Nova Scotia, it should first adopt its own version of the Free Trade and Mobility Within Canada Act.

What’s novel about this approach is that it would let Canadians trade freely while the bureaucrats and politicians focus in the background on trying to harmonize regulations. It also incentivizes every other province and territory to join what promises to be a growing interprovincial free trade zone.

Ontario Premier Doug Ford has already shown interest, and every time another province follows suit, the potential to gain from adopting similar legislation will grow as well.

It’s not like these gains would be small either. According to some estimates, Canada’s economy stands to grow by up to $200 billion simply by eliminating these impediments to trading with each other. This represents roughly $5,100 of extra prosperity per Canadian, something we can’t afford to ignore.

All that’s left to do to unshackle this potential is for Nova Scotia to table and adopt its bill, and for all the other Premiers to follow in its footsteps.

Krystle Wittevrongel est directrice de la Recherche à l’IEDM. Elle signe ce texte à titre personnel.