Canadian Manufacturing

Atlantic provinces need to shed trade, regulatory barriers, study says

With New Brunswick beer battle still raging in court, think tank says axing provincial trade barriers could boost East Coast's GDP by 7.6 per cent



HALIFAX—Atlantic Canada needs a deal to reduce regulatory and trade barriers for areas as basic as the rules on trucks that carry goods around the region, says a report by an economic think tank.

The Atlantic Provinces Economic Council released a report earlier this week saying a region with a market six times smaller than Ontario’s can’t afford barriers in trucking, liquor sales and other sectors.

One restaurant owner told the researchers it was easier to purchase wine and beer internationally than from other Canadian provinces.

The study says removing all trade barriers between Canadian provinces could create gains as high as 3.3 per cent of gross domestic product, while the gains would be more than double that for the Atlantic provinces at 7.6 per cent of GDP.

The study points to priority areas, such as the transport industry, where the region still doesn’t have a standardized system to monitor carriers’ safety performance.

“The trucking industry has been calling for a single carrier profile and safety rating system in Atlantic Canada since at least 2002,” says the report, in one of many examples of inconsistent regulations around the region.

The trucking firms also note they sometimes require multiple permits to carry oversize or overweight loads around the Atlantic region, as the provinces haven’t come up with a single regional permit system.

Meanwhile, spring weight restrictions vary from province to province on secondary roads, “impeding the efficiency of moving goods compared to normal driving times,” notes the study.

The region also retains prohibition-era protectionism in alcohol sales, with Newfoundland and Labrador “not accessible to brewers from other provinces.”

The market for alcohol in Atlantic Canada is large, with over $1 billion in sales, yet Newfoundland and Labrador only exports $7 million of its products to other Atlantic provinces, while Nova Scotia sells just $4 million of its products to New Brunswick.

The Atlantic provinces have created a Joint Office of Regulatory Affairs and Service Effectiveness to improve the regulatory environment.

The report says this has been a step forward, but says the region needs a comprehensive trade agreement with a dispute resolution system.

“To be of value, an Atlantic trade agreement would need to have sufficient scope and power to address the majority of regulatory barriers,” it concludes.

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