By Gary G. Mar
Published in the Calgary Herald
April 13, 2022
Canada relies on moving goods for two out of every three dollars that it makes. Therefore, a plummet in our international rankings on trade infrastructure warrants concern if not outright panic. Yet, this is not what has happened in Canada where its drop from top ten in global rankings to 32nd, a clear warning shot across the country’s bow, has gone virtually unnoticed.
Just the opposite happened in the U.S. where a two-point drop in its global rankings, from 11th to 13th, generated an endless stream of alarm and calls to action from the President, Transport Secretary Buttigieg and others from across the political spectrum. This from a country where trade accounts for barely one-third of the country’s GDP.
The Americans have responded with massive spending plans. More important though is the signal that their articulation of concern and awareness sends to foreign markets – we hear you and we are acting. Yet in Canada, where customers have indicated they no longer have confidence we can keep our delivery time promises, we are sending the opposite message through the relative silence of government officials and the opposition.
Fortunately, the solution to push Canada back to the top ten of global rankings and restore confidence to international customers is straightforward. It starts with acknowledging the problem and then following the path taken by Canada’s competitors.
The key ingredient to all of this is implementing permanent national trade infrastructure plans set by an independent public-private body using criteria of national significance. To have the greatest impact, funding decisions should incorporate criteria based on knowing where projects will have the greatest impact and include some analysis of their return on investment, and that requires the private sector at the table.
Other countries have figured this out, implemented national plans with all that is required to generate them, and have seen their global rankings rise or at least stabilize. Canada could do the same. A decade ago when the country was in the top ten of global rankings it had some elements of this in place but gradually let them lapse while our competitors picked up and improved on the ideas.
This path to climb back up global rankings, while simple, proven and eminently doable, requires a will to act.
The decline in trade infrastructure puts the country’s prosperity in jeopardy. Trade infrastructure is the infrastructure that pays for social housing, schools, parks, hospitals and even a green transition. Canadians must not fail to understand that the money which supports so much of the specific things that matter to families, not just food in stores but our quality and standard of living, are all funded by proceeds from trade.
A plan to improve trade infrastructure is not a case of pitting one type of infrastructure asset against others like social, green and community infrastructure. Rather, it is focusing on one asset class to enable the others.
Therefore, it is not only the business community and people anxious about economic growth who should be concerned about the country’s drop in rankings. Those concerned with social issues, equality and quality of life should be equally alarmed. Our common future depends on it.
Gary Mar is president and CEO of the Canada West Foundation
The Canada West Foundation report, From Shovel Ready to Shovel Worthy: The pathway to a national trade infrastructure plan for the next generation of economic growth, outlines seven building blocks to establish a national plan.