Five years into Canada Free Trade Agreement, too many barriers remain

New CFIB report card grades governments and suggests a more ambitious approach to reducing barriers to internal trade and cooperation

TORONTO, June 30, 2022 /CNW/ - To mark the fifth anniversary of the Canada Free Trade Agreement (CFTA), the Canadian Federation of Independent Business (CFIB) has created a new report card, The State of Internal Trade: Canada's Interprovincial Cooperation Report Card.

"The signing of the CFTA signalled that Canadian governments were finally serious about reducing barriers to the movement of goods, services, labour, and investment. But progress has been slow, and many high-profile barriers remain. For example, if you visit a winery, distillery, or brewery in one province, you still can't ship a box of product home to most other provinces. Isn't this long overdue for a fix?" said Laura Jones, Executive Vice-President at CFIB.

The CFTA replaced the Agreement on Internal Trade (AIT), which the business community and many policy makers viewed as dated and ineffective. The CFTA uses a negative list approach, where everything is included unless a specific exemption is taken (rather than only including things listed in the agreement). Signatories also created a Regulatory Cooperation Table (RCT) to address regulatory differences that act as barriers to trade.

The report card grades governments in three areas: exceptions to the CFTA, select barriers to internal trade, and implementation status of reconciliation agreements. Overall grades range from a low "F" to a high of a "B", with some grades in the subcategories being higher.

The 2022 report card grades are:

CFIB has several recommendations for governments:

• Work as quickly as possible to remove internal trade and labour mobility barriers, including those cited in the report card.
• Provide better and more transparent data on progress, particularly on implementation of reconciliation agreements.
• Proactively engage stakeholders.

The boldest recommendation is for governments to mutually recognize all other provincial and territorial regulatory standards (other than an exemption list). For example, if a business meets the health and safety standards in their home province, that should be accepted by any other province or territory. This could be done unilaterally or as a group.

"The low grades on our first report card do not indicate that no progress has been made. Rather, they reflect that much more work remains," said Corinne Pohlmann, Senior Vice-President of National Affairs at CFIB.

"At one time, eliminating unnecessary barriers to working and trading across Canada was less urgent. Today, with labour shortages and cost pressures mounting, wasting time and money is a luxury few can afford," concluded Jones.

For more information on grades and marking criteria, refer to Canada's Interprovincial Cooperation Report Card.

The Canadian Federation of Independent Business (CFIB) is Canada's largest association of small and medium-sized businesses with 95,000 members across every industry and region. CFIB is dedicated to increasing business owners' chances of success by driving policy change at all levels of government, providing expert advice and tools, and negotiating exclusive savings. Learn more at cfib.ca.

SOURCE Canadian Federation of Independent Business