Home The Ambassador Canada's chief representatives to the U.S. Michael Kergin Ambassador Kergin's Speeches September 29, 2003

The Canada-U.S. Partnership: Staying the course

Remarks by Michael Kergin Ambassador of Canada to the United States to the Canada Club of Montreal

Montreal, Quebec
September 29, 2003

For me, it is a great personal pleasure to be in Montreal. My own background is rooted in western Canada and, dare I mention it here, in Toronto — Toronto the Good as it was known when I grew up there aeons ago.

Montreal was for us Torontonians, such a city of elegance and mystery, beckoning us with its allure of cosmopolitan sophistication. And, in the intervening years, it has never, never, disappointed me.

But, during more recent visits, I am further struck by Montreal's business dynamism, especially in the field of advanced technologies and applied sciences. And it is this vitality and creativity which are so highly appreciated south of the border.

Just today, the Governor of Minnesota is leading a large delegation of bio-tech companies seeking partnerships with their Quebec counterparts.

It is to state the obvious that the commercial, technological and scientific integration experienced between Montreal and its southern neighbour is resulting in increasing economic interdependence. What may be less immediately evident is the corresponding necessity for all Canadians to remain in close touch with the developments in the U.S., both economic and political.

I would therefore, like to report to you today, on how I see these developments from my perch on Pennsylvania Avenue. I would also offer a few comments on the state of the Canada-U.S. relationship.

These days in Washington, "inside the beltway", excitement is building with the approach of the 2004 elections — yes, the season starts early with our southern neighbours. As we well know in Canada, electioneering is as intrinsic to a democracy as the tide is to the ocean.

Almost every front-page story — on the economy, energy, security, Iraq, health care — has electoral implications. And that can sometimes work in Canada's favour. For instance, the Administration has spared no effort in bringing in measures designed to provide fiscal stimulus, which in turn aim to spur economic growth. There are clear signs now that the U.S. economy is strengthening, and that bodes well for Canadian exports.

But, beltway election politics can also work against Canadian interests. For example, the loss of 2.7 million U.S. jobs since January 2001, many of which are in the manufacturing sector, could produce a rising tide of protectionism in Congress. The job loss recovery, as some economists have termed it, may well complicate the search for the resolution of our outstanding trade disputes.

Yet the Canada-U.S. relationship has distinguished itself in the past by its pragmatism. By this, I mean our ability to grasp the big picture: to keep one eye on the horizon while the other seeks out the immediate course ahead.

By transforming unexpected challenges into longer term opportunities, we have been able to find solutions to the most intractable of problems — such as keeping commerce moving at the border in the age when security risks trumping economics.

Let me swim a little further with my maritime metaphor. William Lyon Mackenzie King once said that, "when it comes to politics, one has to do as one [does] at sea with a sailing ship... reach one's course having regard to prevailing winds."

This advice, offered to the House of Commons of the day, can also be applied to the relationship between Canada and the U.S. in the 21st century. This relationship is far too large and all encompassing to allow political winds to blow it off course, as forceful as those words may be perceived to gust at certain times. So pragmatism is a useful quality in the achievement of our common goals.

For example, earlier this month, I participated in a Conference between Eastern Canadian Premiers, including Premier Charest, and New England Governors. The eastern provinces and states share so much in common: robust regional trade, natural resources, environmental concerns, and even family roots. This is regionalism that works.

Now, five out of six New England Governors are Republicans. Yet with their Canadian Premier counterparts, they sent a particularly strong message back to the Republican White House. They protested recent changes by the Environmental Protection Agency to smoke-stack emission standards, thereby making it easier for utilities in the Midwest to modernize their facilities without upgrading their pollution controls, as required under the 1990 Clean Air Act. The possible effect on the Northeast from acid rain is obvious.

Here we have an example of a common regional interest crossing the Canada-U.S. border and rising well above politics — in this case, Republican party politics. And, yes, it is also pragmatism at the service of the longer term objective of cleaner air.

There is no substitute for identifying and resolving problems at a regional level before they become federal issues and are held hostage to the national agenda. As a steward of the overall Canada-U.S. relationship, I welcome sub-national efforts to resolve local issues, provided there is transparency and consultation with the Federal level.

This is one reason why Canada will be expanding our presence throughout the U.S. by opening seven new consulates and appointing 20 new honorary consuls. These bold moves, which should be completed by next year, will strengthen our capacity to advocate interests in the regions in vital economic, political and security matters, thereby enhancing our ability to manage growing economic integration in North America.

The rapid trade growth between Canada and the U.S., particularly from Quebec with its high tech and bio tech industries, is striking. Between Eastern Provinces and States, trade has doubled in the last five years. And between our two countries as a whole, trade has skyrocketed by 112% since we signed NAFTA 10 years ago!

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"!

From the Montreal-area alone, Canada is exporting "Canadarms", state-of-the-art aircraft simulators, and regional jets to the U.S. And soon we will be the first country to export genetically modified, spider-silk fibres to the U.S. Army for making lightweight, super-strong bulletproof vests.

And I fervently hope that Montreal can continue to import American baseball players for a long time to come.

In addition to allowing for the rapid expansion of trade, our innovative Free Trade Agreements have also altered our economic landscape to a degree we could not have imagined. Canadian and U.S. companies are approaching North America as a single market, benefiting from the respective strengths of each country.

There is a corollary to economic integration, however. It is that the days are long gone when structural problems are confined to only one of the partners. We are now obliged to work through issues together and cooperatively.

For example, from the outset of last month's blackout, the Prime Minister and the President were on the phone directing their officials to restore power. Work continues under a joint task force headed by Minister Dhaliwal and Secretary Abraham aimed at identifying the blackout's causes and recommending improvements to our integrated electrical power grids.

Similarly when the discovery of a single case of BSE in an Alberta cow halted Canada's international beef exports, the U.S. Administration and the U.S. industry worked hard to enable the resumption of trade in Canadian beef and game. There was rapid recognition in the U.S. that Canadian beef, with its similar standards and regulatory systems, is as safe as its U.S. counterpart.

And indeed, given the toxic reputation of mad cow disease, the U.S. has moved comparatively quickly to accept shipments of Canadian muscle cuts and the like.

But progress has been slow in opening the border to live beef because of U.S. fears that third country markets will be closed to their own beef exports if there is evidence of any mingling of the Canadian and American product. This is a tough standard, given the 20-year integration of the American and Canadian beef industries.

So we will keep pressing our American friends hard on this issue.

We haven't been successful in resolving our longstanding softwood lumber dispute. We are not giving up on a negotiated settlement, but frankly the prospects here are not encouraging. We are therefore persevering in our efforts to seek legal redress — which, despite early successes, remains a frustratingly long and costly process.

Disputes, such as softwood, wheat and beef, which garner much attention comprise less than 3% of the commercial activity between our countries. Translated into dollars this is a significant amount. But as a proportion of overall trade it tells another story and suggests that our commercial relationship remains healthy, indeed the envy of every other country in the world!

With our strong growth in trade over the past decade, there also has been a dramatic increase in the amount of traffic crossing our border. Some 80% of the almost $700 billion trade per year goes by surface — an extraordinary tribute to our road and rail carriers. Nevertheless, if you drive south from Montreal towards the United States, and cross the border at St. Philippe de LaColle, you will note that we are now confronted by significant challenges unknown prior to Sept. 11, 2001.

Both countries immediately recognized that a border that is closed down for security reasons was simply not an option.

In response to concerns about security and efficiency, Canada and the U.S. developed the Smart Border Accord. Modernizing a border that stretches over 9,000 km, one quarter of which is through water, is no easy feat. But with over 200 million people each year and close to $2 billion in trade moving by land each day between our two countries, the smooth and safe functioning of our shared border is essential for protecting our economies and our ways of life.

The Smart Border Accord includes over 30 innovative arrangements covering everything from customs officials operating in each other's sea ports, to new technologies for scrutinizing cargo, agreements on refugee and visa issues, infrastructure and improved coordination between law enforcement officials.

Two new programs, FAST and NEXUS, allow certain cargo and individuals to be pre-cleared before they get to the border. They can then use dedicated FAST lanes at the border, spending less time idling while freeing up customs officials to concentrate on higher risk traffic.

And our security partnership extends much further than our achievements on the border. We are cooperating together in multilateral institutions such as the International Maritime Organization to develop new international standards governing the loading, shipping and monitoring of container traffic — a source of real concern when one considers that over 10 million containers enter North America every year.

We are working together to share intelligence on people entering North America from other countries. At NORAD, we are exploring the potential for partnering with the U.S. on missile defence to enhance continental security. In my view, these arrangements are an affirmation of Canadian sovereignty because we would remain involved directly in the exercise of our defence, rather than entrusting this blindly to the benevolence of our southern neighbour.

We have also made strides on environmental issues. Building on our long, proud, history of agreements beginning with the visionary boundary Waters Treaty of 1909 and accompanying International Joint Commission (IJC), Canada and the U.S have recently announced the Border Air Quality Strategy to provide a better understanding of pollutants and air movement. Involving federal, state and provincial governments, this strategy again illustrates the exceptionally important partnering role which the regionscan play in improving the overall relationship.

Well beyond our continent, the Canada-U.S. partnership is solid. Indeed, Canada and U.S. are often each other's strongest ally in confronting global challenges to modern society. Whether the issue is the North Korean or Iranian nuclear programs, human rights violations in Cuba, the AIDS crisis in Africa or dismantling weapons of mass destruction in the former Soviet Union, our interests are the same and our approach is complementary.

With regard to Iraq, the U.S. now is seeking the help of the international community to re-establish order and rebuild. Canada strongly supports U.S. efforts to re-engage the UN. And our humanitarian assistance for the Iraqi people and offer to help with security sector reform have been warmly welcomed in Washington.

Our commitments in Afghanistan are also respected and sincerely appreciated. Earlier this month, during a visit by Mr. Graham, our Foreign Minister, Secretary of State Powell publicly thanked the Canadian people, in his words, and I quote "for the contribution they have made to the war against terrorism, especially for what 1,800 brave Canadian service personnel are doing in Afghanistan" and he continued "... It's indicative of the kind of contribution that Canada has been willing to make in the cause of peace over time."

Let me conclude by a reference to Albert Einstein. He once wrote, (in another context) that friendship is partnership. It carries obligations. Perhaps, inadvertently I think he accurately defined the Canada-U.S. relationship. At all levels — regional, federal and international — we have been able to work creatively to address common challenges to the benefit of our citizens for generations to come. This has required consultation, cooperation, compromise and commitment.

The IJC, NORAD, NAFTA, the Smart Border Accord and the Border Air Quality Strategy are all baselines in the management of the world's most successful region. Visionary in their conception, uniquely pragmatic in their implementation, these arrangements serve as a blueprint for good neighbours everywhere.

Rooted in the core values which we both share, they are an important reason why, regardless of any passing gusts, Canadians and Americans will continue to stay the course as best friends, long-term partners and extended family.

Thank you.