implications for Immigration and Diversity

Slide 1:The Border, Canada-US Trade and the Post-9/11 Security Regimewith implications for Immigration and Diversity

Bill Anderson bander@uwindsor.ca Ontario Research Chair in Cross-Border Transportation Policy University of Windsor Prepared for Citizenship and Immigration Canada January 14, 2009

Slide 2:Canada-US Border

largest bilateral trade relationship in the world ($1.5B per day) Mostly through Great Lakes crossings Cross-border supply chains 150,000 cars per day Increasing global trade through Canada to US Many miles of unfenced, unposted wilderness

Slide 4:Canadian Exports to US 2007

Fuels(25%) Cars, trucks and parts (19%) Electricity generation equipment (7%) Plastics (3.4%) Electrical Machinery (3.4%) All other categories 3% or less

Slide 5:US Exports to Canada 2007

Cars, trucks and parts (22%) Electricity generating equipment (16%) Electrical machinery (7%) Plastics (5%) Fuels (3.5%) All other categories 3% or less

Slide 6:Ontario Economy

Largest manufacturing work force in North America except California 1994-2003, manufacturing employment +33% Exports are 59% of GDP, mostly manufactured goods More than � of Canadian Exports Automotives account for 38% of exports 80-90% of cars manufactured in Ontario sold in US.

Slide 7:Merchandise Trade Crossing

Oil, iron ore and other resource products cross by pipeline, water and rail largest rail crossing by value at Sarnia (by weight at Fort Frances) Most manufactured goods cross by truck, almost half on two bridges at Windsor/Detroit and Fort Erie/Buffalo Rapid movement of goods to support just-in-time production systems, especially in automotive industry

Slide 8:Mode Share of Canada � US Trade

Slide 9:Ontario Border Crossings

Slide 10:Border Infrastructure

Slide 11:Ambassador Bridge: busiest freight border crossing

More than 25% of all US-Canada trade, 35% or road trade 10,000 commercial vehicles on a typical day Privately owned, 80 years old, 4 lanes 6 lane replacement planned Additional crossing planned down river

Slide 12:Other SW Ontario Crossings

Bluewater Bridge (Sarnia � Port Huron, 12.5% of road trade) Detroit � Windsor tunnel (#1 passenger crossing) CN rail tunnel Sarnia � Port Huron, CPR rail tunnel Windsor � Detroit Windsor � Detroit truck ferry for hazardous materials

Slide 13:Peace Bridge

Number 2 bridge, handles most of the freight through the Port of Buffalo Also 80 years old, owned and managed by an international commission Ongoing expansion plans complicated by local and environmental concerns 2003-8: truck traffic steady but cars down 11%

Slide 15:Other Niagara Frontier Crossings

Queenston � Lewiston Bridge (#4 road crossing, freight in transit) Rainbow Bridge Whirlpool Bridge International Railway Bridge (used by CN and CPR)

Slide 16:Impacts of September 11, 2001 on US-Canada Border

Near closure of Ambassador bridge, hundreds of factories shut down Heightened security leading to long delays at borders for both freight and passengers Western Hemisphere Travel Initiative: passport or comparable document required between Canada and US Land border implementation June 2009 fewer than 30% of Americans and 50% of Canadians had passports in 2007 Summer 2007, delays comparable to 2002

Slide 17:Cross-Border Supply Chains

Slide 18:Cross-border supply chains

Value added in both Canada and US Automotive industry 1965 Automotive Products Trade Agreement Components may cross border more than once Agriculture (Livestock) Pork: piglets raised in Canada, shipped to US for fattening and slaughter Other cross-border supply chains: machinery, mineral energy, forest products, seafood

Slide 19:Frequency of supply and distance (2002 CAR study)

Slide 20:Impacts of border on auto industry

1 hour shutdown of assembly plant costs about $60,000 � this could be the cost of a delay in components delivery US assembled car contains about $1000 Canadian content, Canada assembled car contains $7500 US content (2002 CAR study) Canadian automotive plants more vulnerable to cross-border delivery risk

Slide 21:Current Threats to Ontario�s Automotive Industry

Credit crisis, low demand Slow border crossings High dollar Changes in relative labour costs End of Auto Pact protections Shift of US production away from border Potential massive subsidization for retooling US plants

Slide 22:Economic Impacts of Border Delays

Labor and capital cost of idling trucks Risk of factory shutdowns due to failure to deliver components on time Inventory stockpiling to insure against delays Reduced tourism 7.1M jobs in US and 3M jobs in Canada depend on cross-border trade (US and Canada C of C) Estimated annual delay cost at over $10B (Ontario C of C).

Slide 23:Policy

Slide 24:Addressing the border problem

Expand and improve border operations New and expanded crossing infrastructure More booths, more personnel Improved technologies Better Canada-US coordination Move functions away from the border Risk-based assessment E-manifest �reverse inspection�

Slide 25:Addressing the border problem (cont.)

Alternative modes Road/rail intermodal Short-sea shipping The perimeter approach

Slide 26:Perimeter approach to North American Security

Proposed by US Ambassador Gordon Giffen in 2000 Precedent in US/Canada export control perimeter Shift security from US-Canada border to US-Canada perimeter Requires adoption of common security standards and integration of law enforcement efforts In the extreme case could lead to �open� border comparable to EU.

Slide 27:Perimeter approach: practical problems

Harmonization in some areas may be difficult or controversial: firearms refugee and other immigration policies NAFTA is not a customs union and does not allow free movement of labor

Slide 29:Perimeter approach: political obstacles

From the US side Public reluctant to trust officials of a foreign government to maintain security From the Canadian side Public sees this as a reduction in Canadian sovereignty (autonomy), because American standards are likely to prevail

Slide 30:Risk-based assessment

Pre-qualifying some individuals or firms as low-risk � �making the haystack smaller� Comparable to basing insurance rates on demographic characteristics Exempting low-risk travelers or shippers from some security procedures Requires low-risk certification by both countries

Slide 31:Trusted traveler program: NEXUS

US or Canadians register for program ($50) Requires background info and interview with border officials of other country Biometric identification Special lanes on bridges and other crossings and at airports Chambers of Commerce: goal to enroll one million people in NEXUS by late 2009

Slide 32:�Trusted shipper� programs(Supply Chain Security)

Expedited clearance for companies whose supply chain facilities and procedures are inspected and certified by border agencies Cooperation from importers, carriers, brokers, warehouse operators, manufacturers etc. On-site inspections Background screening of individuals

Slide 33:Trusted Shipper (cont.)

PIP (Partners in Protection, Canada) and C-TPAT (Customs-Trade Partnership Against Terrorism, US) FAST bilateral program, pre-qualifies drivers, carriers and importers as low risk FAST lanes at about 20 crossings TWIC (Transport Workers Identity Credentials), needed for access to US port facilities

Slide 34:Practical problems with trusted shipper programs

Separate lanes are not long enough to avoid backups Program participants still subject to secondary search Cost of compliance for membership up to $100,000 Many firms decide its not worth it Complaints that they discriminate against smaller firms

Slide 35:Potential issues for immigration and diversity

In the border regions, a FAST card is a precondition for employment as a truck driver Applications must be approved by both US and Canada Some criticism based on lack of transparency (Truck News, Feb 2007) Anecdotal evidence that immigrant groups may be disadvantaged or be reluctant to apply

Slide 36:Grounds for denial of FAST Card application

Provide false information on application Convicted for a criminal offense in any country Violate of customs or immigration program �Fail to meet other requirements of the FAST Commercial Driver Program�

Slide 37:Issues of special relevance to immigrants

Information required on Rehabilitation under Canadian Immigration laws Waivers of inadmissibility issued under US immigration laws �any personal information you provide will be shared with other government and law enforcement agencies�

Slide 38:Issues to be addressed

Are certain groups more likely to have their applications rejected? (no statistical evidence that I know of) Do rejected applicants pursue review option and discover reason for rejection? Are certain groups reluctant to apply in the first place or reluctant to reapply if they are rejected? What help can be provided to immigrant drivers and business people seeking certification? Effect on Temporary Foreign Worker Program

Slide 39:Broader political challenges

Some US interests may benefit from border problems �Anti free trade� forces in Canada may favor border delays US-Canada border issues often linked with US-Mexico border issues

Slide 40:3 Asymmetries

Proportional weight: US-Canada trade makes up a larger share of Canada�s economy. Vulnerability: abandonment of cross-border supply chains biased against smaller economy. Political influence: US preferences likely to prevail in joint decision making.