Supply Chain Scanner - Week of October 7, 2024

Weekly blog by Emily Atkins

Pilot Project Tackling Interprovincial Barriers to Trade by Truck

Federal, provincial, and territorial (FPT) ministers have endorsed a mutual recognition pilot project in the trucking sector to explore where they could recognize one another’s regulatory requirements while ensuring levels of safety are maintained or strengthened.

The notion for the project came at the annual Committee on Internal Trade (CIT) meeting, a ministerial table established under the Canadian Free Trade Agreement (CFTA) to oversee the agreement’s implementation. The CIT includes representatives from all 13 of Canada’s provinces and territories and the federal government. It meets annually, and as needed, to evaluate Canada’s internal trade environment and review progress under the CFTA.

At this year’s meeting ministers approved the 2024-2027 Internal Trade Action Plan, which will facilitate internal trade by reducing regulatory burdens and cutting red tape to create new opportunities for trade between provinces and territories. To that end, the ministerial group recognized that “safe, robust transportation networks are necessary to efficiently and reliably move goods across Canada, which is vital to Canada’s competitiveness, productivity and standard of living.”

The governments of Canada, Ontario, Nova Scotia, Manitoba, Prince Edward Island, Saskatchewan, Alberta, Newfoundland and Labrador, Northwest Territories, Yukon, and Nunavut will take part in the project which could include measures such as driver medical requirements, training requirements, time-of-day definitions, and oversized vehicle signage requirements. It will be co-chaired by Canada and Newfoundland and Labrador. The participating governments will be reporting back on progress by CIT 2025.

Business groups have applauded the initiative.

“This is welcome news for the trucking industry and a positive step for economic development in the provinces and the territories,” said Canadian Trucking Alliance president Stephen Laskowski.

“Canada moves by truck, and bringing all levels of government together to identify and eliminate trade barriers is an important step in improving the movement of trucking equipment, drivers and their goods. This is the beginning of the process and refining the mechanisms will lead to more opportunities for our national and provincial economies to become more efficient and competitive.”

The Canadian Chamber of Commerce weighed in noting that trucking accounts for nearly 30% of Canada’s transportation sector and is one of the most flexible ways to move goods.

“Over time, different levels of government have introduced their own laws, rules, and requirements to address vehicular requirements in different ways. However, trucking companies do not get to choose which rules they follow – they must comply with all of them, adding inefficiencies, costs, and administrative burdens. This makes trucking and trade more difficult, and ultimately, life more expensive in Canada. In an uncertain labour climate and a productivity crisis, it is crucial that all governments act swiftly to remove any barriers in their control,” said Randall Zalazar, the Chamber’s director of government relations.

“The trucking pilot project will provide governments with the evidence they need to continue dismantling the barriers to seamless truck movement across the country. We should not need a free trade agreement just to do business in our own country, and it shouldn’t be easier to trade internationally than interprovincially. Internal trade barriers – including needlessly complex regulations and interprovincial regulatory overlap – impose a staggering annual cost of over $14 billion. Governments can and must continue this crucial work. The livelihood of Canadians depends on it.”

The Canadian Federation of Independent Business (CFIB) said the announcement “marks the first bold step Canadian governments have taken to eliminate internal trade barriers since the signing of the Canadian Free Trade Agreement (CFTA) in 2017.”

CFIB has advocated for mutual recognition since it became apparent that the CFTA fell short in addressing many barriers to the movement of goods, services and people across Canada. This pilot project will allow jurisdictions to recognize one another’s regulatory requirements without compromising safety within the trucking industry. “Mutual recognition not only enhances efficiency by reducing red tape and lowering costs but also contributes to greater competitiveness for small businesses. As pointed out in CFIB’s 2024 State of Internal Trade report, eliminating internal trade barriers could add $200 billion to Canada’s economy annually. It would be a mistake for Canada’s leaders to ignore this important approach to boost productivity and the economy,” said Keyli Loeppky, director of Alberta and interprovincial affairs at CFIB.

CFIB noted that several jurisdictions, namely British Columbia, Quebec and New Brunswick, have not said they will take part in the pilot. It urged them to get on board. Interestingly and perhaps not coincidentally, New Brunswick and Quebec scored lowest on the CFIB’s 2024 Interprovincial Cooperation Report Card, which grades federal, provincial, and territorial governments' interprovincial cooperation efforts.

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Emily Atkins
President
Emily Atkins Group

 

Emily Atkins is president of Emily Atkins Group and was editor of Inside Logistics from 2002 to 2024. She has lived and worked around the world as a journalist and writer for hire, with experience in several sectors besides supply chain, including automotive, insurance and waste management. Based in Southern Ontario, when she’s not researching or writing a story she can be found on her bike, in a kayak, singing in the band or at the wheel of her race car. LinkedIn: https://www.linkedin.com/in/emilyatkinsgroup/