TheSecurityandProsperityPartnership(SPP)launchedin2005bytheUnitedStates,Canada, and Mexico, is an overarching agreement to conduct negotiations in a wide varietyofareasrelatedtoproductstandards,governmentregulationsontrade,healthandfoodsafety,energy,andtheenvironmentaswellasawidevarietyofsecuritymea-sures related to border crossings. The objective is to achieve gradually more regula-tory convergence and product standards compatibility as well as more streamlinedborder and security measures so that the costs of trade and border crossings can belowered,whilestandardsandregulationsbecomemorecontinent-wide.SPPnegotia-tions aremeant tolead tospecificagreements on asector-by-sectorbasisand mainly affect changes in the administrative or executive branches of government. Thus far,SPPnegotiationsandagreementshavemodestlyadvancedCanada’snationalinterestby removing or reducing non-tariff barriers to trade. Closer cooperation and coordi-nation among the governments has also helped make the implementation of post-9/11 security provisions more efficient.The objective of the SPP talks is very much in Canada’s economic interest andwillbenefitNorthAmericancompetitiveness.With51percentoftotalexportstotheUnited States going out of Canada by truck, and 77 percent of imports from theUnited States coming into Canada by truck in 2006, low-cost border crossing shouldbe an integral part of Canadian policy. However, regulatory differences are a provenbarrier to cross-border trade. These differences include the processing of customsmanifests, security documents, and procedures. Furthermore, regulatory differencesoneithersideoftheborderforidenticalproductsimposeanartificialcostonproduc-tion that is rendering North American business less competitive globally.The Canada-United States Free Trade Agreement (CUFTA) and the NorthAmerican Free Trade Agreement (NAFTA) have generated strong growth in trade,especiallyforCanadianexports. Similarly, regulatoryharmonization and compatibleproductstandards,aswellasmoreefficientandlower-costcross-borderregimes,willmake Canadian industry more competitive and will add to Canadian prosperity. AsCanada is the bigger exporter in the Canada-United States bilateral trade relation-ship,thebruntofthecurrentstandardsandregulatoryincompatibilityaswellasbor-der inefficiencies are borne disproportionately by Canada.SPP negotiations are conducted by officials in the various government depart-mentsofthethreecountriesandbenefitfromtheadviceofbusinessgroupsinidenti-fyingareaswheremorestandardcompatibilityandmoreharmonizedregulationsaremost pressing. The SPP consists of technical talks conducted by expert officials.
TheFraserInstitute / March2008www.fraserinstitute.orgSavingtheNorthAmericanSecurityandProsperityPartnership