Internal trade negotiations a solution in search of a problem, CCPA says

(Ottawa) Federal-provincial negotiations to expand the Agreement on Internal Trade (AIT) should be stopped, according to a briefing paper by the Canadian Centre for Policy Alternatives, In Search of a Problem: The Future of the Agreement on Internal Trade and Canadian Federalism.

Federal and provincial governments are currently in the midst of a consultation process regarding the new negotiations in three cities across the country.

The paper notes that there are few benefits to be gained from new negotiations because any barriers to trade within Canada are miniscule at most. However, expanding the AIT may undermine provincial authority to set standards and promote economic development.

"The idea that there are large interprovincial trade barriers in Canada is a myth," said Marc Lee, the report's author. "The term 'trade barriers' is being invoked when the real issue is how provinces regulate labour markets, consumer protection and environmental standards. These laws and regulations may be unpopular with the business community, but they are legitimate goals for democratically elected governments."

Current negotiations are looking at structural reforms that would give the AIT broader enforcement powers, and would strengthen the hand of investors to challenge government laws and regulations. In addition, a new Energy chapter has been agreed on, but has not been made public.

Instead, the report calls for federal-provincial negotiations that deal with practical problems, not general rules that handcuff governments.

"There are important issues that need to be addressed, such as labour mobility for professionals across provinces," said Lee. "The AIT, however, is an elaborate, legalistic framework rather than a practical attempt to solve real issues."