US Business

Canada and the United States enjoy the closest economic relationship of any two countries in the world. We don’t just trade goods and services with one another; we build things together. We innovate together. And we need our governments to work together to translate good intentions into bottom-line results.

That's why CME invests heavily in advocacy efforts related to US business. For example, we are the only association in Canada to have a full-time representative in Washington. Through this American office, CME's US expert, Birgit Matthiesen, provides you the real-time intelligence and insight you need to be successful south of the 49th parallel. Make sure too sign up for Birgit's monthy newsletter, US Watch.

CME is especially involved in the following US-related issues:

• Buy American Procurement
• Customs and Border Regulations

Buy American Procurement

Buy American has been the biggest issue between Canada and the US in recent history. CME has taken the lead on behalf of its members to spur Canadian government action to mitigate the adverse consequences of Buy American restrictions on Canadian exporters. Our efforts led to Canada and the US announcing an agreement coming into force on February 16, 2010, that allows Canadian manufacturers to participate in a number of infrastructure projects funded by American Recovery and Reinvestment Act (ARRA), and permanently opens procurement markets in 37 US states.

But earlier in 2011, protectionist provisions reared their ugly head again – this time in the form of President Obama's jobs bill. CME continues to state Canada's case very clearly: You don't create jobs by restricting business opportunities between the world's two largest trading partners.

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Customs and Border Regulations

Canada and the US rely upon each other’s markets to support millions of jobs and to design, build and compete with our products in global markets. The most often-cited example is car parts, which will cross the shared border as many as six times before the finished product is sold to a consumer in either market. This cross-border movement of production components has been estimated to add several hundred dollars per vehicle to the cost of vehicle assembly, adversely impacting North American competitiveness.

While the volumes may not be as high, the same process takes place in almost all sectors of our integrated economy, all adding costs and negatively impacting profitability and jobs. Our governments manage and regulate trade between each other in the same way as trade from off shore, foreign markets. The reality is that unlike trade with foreign markets, trade between our markets is dominated by cross-border shipments within a single corporate enterprise or within an integrated supply chain with known trade partners. As such, trade data requirements should not be the same for internal market shipments as they are for foreign imports and exports because the risk is not the same.

To help advocate for proactive change, CME has led the formation of the Businesses for a Better Border (B3) coalition, which represents companies that have significant manufacturing operations, including integrated supply chains, in Canada and the United States in a wide range of industries including automotive manufacturing, food products, mining and metal processing, consumer products and technology. Collectively, members of B3 account for roughly 35 per cent of the trade volume across the Canada/US border and employ hundreds of thousands of Canadians and Americans through their integrated operations. Additionally, our members are vetted trusted trading partners of governments through trusted shipper programs such as Customs Trade Partnership Against Terrorism (C-TPAT) and Customs Self-Assessment (CSA). Individually, our members are global companies fighting for customers domestically and in markets around the world against other globally integrated competitors.

However, the North American economy is unique globally. We are the only advanced economy that is deeply integrated across international borders as a result of historical efforts by governments to create more globally competitive industries through aggressive forward thinking initiatives, beginning with the 1965 Auto Pact and leading to the 1988 Canada-US FTA, and the 1994 North American Free Trade Agreement. While other jurisdictions have moved aggressively over the past two decades to enhance the global competitiveness of their industries through initiatives such as the elimination of internal market borders (e.g., the European Union), Canada and the United States have not made similar advances. As such, our integrated industries face barriers and costs that our global competitors do not face.

The President and Prime Minister’s recent declaration is the time for Canada and the US to take another aggressive and forward looking step in our economic partnership through the Beyond the Borders Working Group. The primary objective of B3 is to reduce the cost of border compliance for integrated industries, by reducing the regulatory burden for border crossings and shortening border crossing times through the enhancement of existing trusted trader programs. Specifically, we believe the priority for the BBWG should be to create a harmonized system of border operations between the countries that separates traffic and their reporting requirements at the border into three distinct types based on the levels of investments by companies and the advanced knowledge and information of those companies that governments have.

For more information, read our full recommendations to the BBWG.