Home The Ambassador Canada's chief representatives to the U.S. Michael Kergin Ambassador Kergin's Speeches July 14, 2003

Remarks to the Pacific NorthWest Economic Region Annual Summit

Calgary, Alberta
July 14, 2003

Thank you for your kind introduction.

I am delighted to be here in Calgary today. It is a particular honour to be present at the start of the annual summit of the Pacific NorthWest Economic Region. Your organization is a pioneer, as well as model for the broader Canada-U.S. relationship: you approach common issues cooperatively, and you are broadening your reach to take advantage of new opportunities. Based on good ideas, common sense and trust, PNWER is the epitome of a successful partnership. And it is an example for us all.

Einstein once said that, "friendship engenders partnership." And I would add that in the case of Canada and the United States, the reverse is also true.

It is hard to imagine two countries who have forged a more successful partnership than Canada and the United States. Resourcefulness makes our relationship unique. Resourcefulness converts challenges into opportunities — an alchemist's gift that has served us well in the past and will guide our actions in future.

And resourcefulness is very much alive and well in the west!

Today, there is no greater challenge to our security than terrorism. Incidents in Bali, Saudi Arabia, Morocco, and Israel are, I fear, harbingers of more to come.

To our American friends here, you should know that the U.S. has no greater ally than Canada in the war against terrorism.

Overseas, Canadian forces fought in Afghanistan in the thick of the early action shoulder-to-shoulder with the U.S. 101st Airborne. In fact, over 4,500 Canadians have served in the Persian Gulf since the commencement of operation enduring freedom in the fall of 2001. Over the coming year, approximately 1900 Canadian forces personnel will be deployed to Afghanistan as part of the International Security Assistance Force (ISAF), a NATO-led operation to assist the afghan transitional authority with security. In addition, Canada will continue to have a naval presence in the Gulf in support of interdiction operations.

Canada, with its strong tradition of assisting states recovering from conflict, is also prepared to help the U.S. and the UN meet the dire needs of the Iraqi people. As part of a $300 million financial contribution for humanitarian and reconstruction assistance, Canada is sending airlift capacity to distribute food and medical supplies. Once the security situation stabilizes, we will deploy police, corrections and legal officers to help with training and advice on governance and security sector reform.

Although we have taken important measures domestically to combat terrorism, I would say that our most remarkable achievement is the Canada-U.S. Smart Border Agreement. This includes over 30 innovative arrangements for improving the security and efficiency of our common border. It includes agreements on refugee issues, infrastructure, and increased information-sharing among law enforcement and intelligence officials.

Two new programs, FAST and NEXUS, now allow approved cargo and individuals to be pre-cleared away from the border by employing state-of-the-art technologies for tracking and verification. In B.C., you will find FAST at the Douglas crossing, and NEXUS at both the Pacific Highway and Boundary Bay crossing points, and it will be running at Coutts, Alberta by the end of the year.

And at least one important element of the Smart Border Agreement, Integrated Border Enforcement Teams (or IBETs), is borrowed from a highly successful B.C.-Washington state program which has been operating since 1996. The IBETs are multi-agency teams which target cross-border criminal activity across the length of our border all the way to Nova Scotia.

There is no better example where a regional practice has succeeded so well that it has paved the way for national application. We have all benefited greatly and thank B.C. and Washington state for the idea!

Tighter security is not the only motivation behind the "smart border": done right, it also will improve efficiency, reduce delays, and lower transaction costs.

Our border supports the world's largest trading relationship, with about $1.6 billion CDN in trade per day and over 200 million people crossing it per year. (This is almost 10 times the number of people travelling between Europe and the U.S.!). We are each other's most important trading partner.

You all know how important the U.S. market is to Canada, but the reverse is also true. For more than half a century, the U.S. has sold more goods to Canada than to any other country. In fact Canada, which has an economy that is less than a tenth the size of that of the U.S., absorbs almost one-quarter of all U.S. exports — more than Japan, Germany, Britain, Italy, China and Hong Kong combined!

We have come a long way since the late Prime Minister Trudeau jokingly called Canada an exporter of "hockey players and cold fronts" and an importer of "baseball players and acid rain"!

The Canada-U.S. Free Trade Agreement, which was expanded in 1994 to include Mexico, did not fix the cold front and acid rain situation, but it sure paid dividends in trade expansion. In the past decade, commerce between Canada and the U.S. has skyrocketed — by 112%!

These innovative arrangements have become more than a scorecard for trade. They have altered our economic landscape to a degree that we could not have imagined.

Increasingly Canadian and U.S. companies are approaching North America as a single market, which is factored into their investment and production decisions. Conscious of the bottom line, they seek profitable advantage by benefiting from the strengths of each country.

With this integration, businesses on both sides of the border have prospered. But an important corollary has also emerged. When we have common challenges, like the single case of BSE found in Canada, they must be addressed jointly. We at the Embassy have been working overtime along side Ottawa and the provinces to make the case for lifting the ban and putting Canadian beef back in U.S. supermarkets.

Another challenge to Canadian livestock producers is the country of origin labelling requirement which will be mandatory September 2004. The COOL law places onerous and unreasonable demands on the industry in both Canada and the U.S. In my view, it has nothing to do with food safety as both countries have similar high standards of food safety.

In the decade since the conclusion of NAFTA, we have reached the point that the North American market must be viewed as a comprehensive commercial entity. Governments and the private sector need to develop policies which recognize the interdependence of our economies. The beef and steel industries qualify.

It is certainly true for the energy sector. People in this audience will not be surprised to hear that Canada is, by a long shot, the largest foreign energy supplier to the U.S., providing:

• 94% of American natural gas imports;
• close to 100% of American electricity imports, and
• more crude and refined oil products to the U.S. than any other foreign supplier (including Saudi Arabia).

Indeed, measured by BTUs, the U.S. Embassy in Ottawa has calculated that Canada provides one third of all energy imported into the U.S. This part of our relationship runs smoothly.

Nevertheless, we do have our trade challenges. Some, like softwood lumber or wheat, have been around for a very long time. Because of our distinct histories, our two countries occasionally have developed differing regulatory or management systems — not wrong, illegal or contrary to international trade rules; just different.

My hope is that Canadians and Americans can work out their differences with a long-term solution to the lumber dispute without having to continue costly, lengthy and frustrating litigation. [And I am confident that the wheat issue will be resolved in our favour. Canada has prevailed so many times in the past.]

And while I do not in any way wish to diminish the gravity of our trade disputes, I should point out that they generally represent a small proportion of the overall commercial activity between our two countries. And it is precisely because they are anomalies, that they garner so much of our attention.

The sustainability of natural resources is important to the Pacific Northwest region — for continued economic success and for quality of life. Canada and the U.S. have a proud history of joint stewardship of our shared water, air and fisheries.

The Northwest exemplifies this long standing co-operation. Indeed, less than two weeks ago, David Anderson, Canadian Environment Minister, and Christine Todd-Whitman, EPA Administrator, announced the Georgia Basin/Puget Sound International Airshed Strategy.

This new strategy aims to protect transboundary air quality on the west coast by providing a better understanding of the effect of air movement on pollutants and air particulates. And it involves the two federal governments, the B.C. and Washington state governments, first nations and local communities. This is another excellent example of the innovation and cooperation that marks our partnership.

And PNWER has shown leadership in extending this cooperation to new areas. Your "partnership for regional infrastructure security" and the successful blue cascades exercises are good examples of the important role which regional organizations can play in enhancing our collective security and economic well-being.

About four hundred years ago, the English statesman, Sir Francis Bacon, observed that, "laws and institutions must go hand in hand with the progress of the human mind."

The principal strength of the Canada-U.S. relationship resides in the ability of our respective governments to find often daring ways to modernize our laws and institutions, thereby improving the lives of our citizens. For example:

• In the face of global terrorism, we developed innovative procedures to make our shared border at once more safe and more efficient;
• To enhance our economies, we developed the free trade agreement which has surpassed our expectations;
• And for almost a century, we have harnessed science and economics to safeguard our shared environment for the use of future generations, while respecting each other's sovereignty.

But federal governments have not done this by acting alone. PNWER's success is solid evidence that our countries' economic and security objectives can be met only by developing practical partnerships between regional and national players.

And in achieving this cooperation, it can then be said the U.S. Canada relationship more than just meets Francis Bacon's standard: the relationship indeed, becomes a living partnership; it remains an enduring friendship; and it provides an example to the rest of the world.

Thank you.