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Business Groups Want Acceleration of Efforts to Increase North American Competitiveness

Monday, October 07, 2013
Sandler, Travis & Rosenberg Trade Report

Major business groups from the U.S., Canada and Mexico sent a joint letter to their country’s leaders Oct. 3 urging an acceleration of efforts to strengthen economic relations among the NAFTA partners and enhance their competitiveness in the global economy.

The Business Roundtable, the Canadian Council of Chief Executives and the Consejo Mexicano de Hombres de Negocios said the international trade and investment landscape has changed dramatically since NAFTA was enacted nearly 20 years ago and that despite the successes of that agreement there continue to be obstacles to doing business in the region. As a result, they said, more can and should be done to promote regulatory cooperation, facilitate the legitimate movement of people, goods and services throughout the North American market, and realize the potential for North American energy self-reliance. “The challenge,” the letter concluded, “is to move beyond pilot projects, feasibility studies and regulatory reviews to fuller implementation and longer-term, strategic action.”

Specific recommendations include the following.

Border Operations


- Beyond the Border pilot projects on pre-clearance and expedited flows of people and goods that have proven successful should be made permanent and integrated trilaterally whenever possible and as quickly as possible. The three governments should eventually recognize the equivalence of their security systems.

- The deployment and coordination of next-generation technologies to create a more automated and paperless experience at the borders should be accelerated. The groups expect that by end of 2014 the Canadian and U.S. governments will complete the single electronic window to satisfy all customs requirements and that by the end of 2013 all major crossings between Canada and the U.S. will be using radio frequency identification technology.

- An inventory of fees and charges levied at both the Canada-U.S. and U.S.-Mexico borders should be completed in 2013 with the objective of ensuring that no new fees are introduced and that fees that negatively affect supply chains are eliminated.

- Governments should increase resource sharing at the border by establishing integrated customs plazas and reducing duplication where appropriate. Customs and immigration officials should be designated to work within other relevant agencies on both sides of the border. For health and safety certification of goods, mutual accreditation of officials should begin on a pilot basis.

Regulatory Standards and Practices


- Each government should separately issue an annual report identifying new divergent regulations that will have a significant impact on North American commerce, with an eye toward reducing, eliminating or preventing unnecessary differences in regulatory requirements.

- Governments should promote sound regulatory principles that can be applied across regulatory entities to ensure that regulations are cost-effective, grounded in the most advanced scientific knowledge available, and are the most efficient and effective means to achieve objectives. Regulatory processes should be open to public scrutiny, regulations should be reviewed regularly to determine whether they should be reformed or discontinued, and paperwork burdens should be considered and reduced where possible.

- Bilateral Regulatory Councils should meet annually to promote an ongoing dialogue, share best practices and identify areas where bilateral regulatory cooperation can be expanded to trilateral cooperation. The councils should also complete their current work plans within the next 12-18 months and then expand into new sectors, starting with energy.

Energy Security and Sustainability


- All three countries should improve their energy project permitting processes to streamline reviews and expedite decisions.

- The development of North American renewable energy resources, as well as energy-related science and technology investments, should be encouraged. This would include the development of commercially viable North American tidal, wind, solar and bio-mass alternatives as well as the inclusion of hydropower within the definition of renewable energy.

- A trilateral committee should be created to “strengthen our continental energy advantage,” with objectives that could include improving the security and reliability of cross-border energy infrastructure and greater cooperation on energy efficiency.

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