Canada’s premiers have talked about the need to break down inter-provincial trade barriers for years but the trade tariff threat from U.S. President Donald Trump may prompt them to finally take action.
Trump’s threat to impose a 10 per cent tariff on oil and gas, and a 25 per cent tariff on other Canadian exports to the United States is on hold for 30 days.
Federal and provincial governments are using the delay to come up with a strategy both to avoid tariffs and to lessen Canada’s dependence on trade with the U.S. by finding new trading partners and increasing trade within provinces.
Gary Mar, a former Alberta cabinet minister who is president and CEO of the Canada West Foundation, said he’s happy to see the renewed push to finally eliminate internal trade barriers.
“I think it’s good,” he said. “I think that this would be perhaps one of the silver linings of the issues that we face vis-à-vis the United States.”
Federal Transport and Internal Trade Minister Anita Anand told reporters in Halifax earlier Wednesday that she believed inter-provincial trade barriers could disappear in 30 days based on the progress of meetings between her government and the provincial and territorial premiers.
Alberta is a signatory of the New West Partnership Trade Agreement with B.C., Saskatchewan and Manitoba and the Canada Free Trade Agreement (CFTA).,
The CFTA allows provinces to make exemptions to opt out of the rules for certain industries and products.
Mar said he has heard more talk about ending inter-provincial trade barriers in the last two weeks than in the previous 20 years.
“I think our relationship and trading with the United States has changed forever and I don’t think it’s ever going to go back to the way that it was,” Mar said.
“The risk of not doing the right thing on reducing internal trade barriers is a greater risk if we don’t do it, than if we do.”
Talking to a wall
Alberta has been involved in its share of inter-provincial trade battles. One of the more memorable spats was in 2018 when then-premier Rachel Notley stopped imports of wine from British Columbia in response to B.C.’s efforts to delay expansion of the Trans Mountain pipeline.
The boycott ended within two weeks after John Horgan, the B.C. premier at the time, referred the pipeline issue to the courts.
Jason Kenney said he tried to open up inter-provincial trade when he was premier of Alberta from 2019 to 2022.
In 2019, Kenney unilaterally dropped 90 per cent of the trade exemptions under the Canadian Free Trade Agreement.
“I hoped other provinces would follow our lead,” Kenney said in an interview with Radio-Canada on Wednesday.
“Unfortunately, with the exception of some progress from Manitoba, the other provinces just ignored it and they didn’t move forward.”
Kenney tried again in 2022 with a plan he presented to the Council of the Federation meeting that proposed recognizing each province’s regulations, but he said again, no one was interested.
“I felt like I was talking to the wall,” Kenney said, adding that he isn’t criticizing the other premiers.
They were dealing with more top-of-mind problems like health-care wait times, fiscal problems and the transition out of COVID-19, he said. They weren’t feeling any pressure from the public to do something about internal trade.
“A boring, technical, deep structural issue like the lack of regulatory harmonization just doesn’t grab their attention on a sustained basis,” Kenney said.
“I’m hoping that Mr.Trump’s tariffs will change that.”
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