Government of Alberta Lifts More Internal Trade Restrictions
September 23, 2019
On Friday, September 21, the Government of Alberta announced it would further commit to removing eight more restrictions to internal trade, and narrowing a further two more exceptions.
Last week’s announcement is in addition to the announcement made in July where Premier Kenney announced that Alberta would unilaterally eliminate 13 exceptions, including all exceptions related to procurement.
The combination of the two eliminates 21 of the 27 exceptions that Alberta had in the Canadian Free Trade Agreement (CFTA), while further reducing two more. At just six exceptions, Alberta now has the lowest number of exceptions that limit internal free trade between provinces and territories.
The Calgary Chamber is encouraged by the provincial government’s commitment to taking a leadership role and championing internal free trade. This was one of the nine recommendations made by the Chamber in our provincial election platform.
Economists estimate that internal trade barriers could be costing the Canadian economy between $50 to $130 billion each year in economic activity. If we take $100 billion as a marker, this would translate to roughly $7,000 per household that Canadians are losing in economic activity due to these barriers.
In a study earlier this year, the International Monetary Fund (IMF) found that if internal trade barriers were removed, Canada’s GDP could grow as much as 4 per cent. In addition to the economic benefits that we sacrifice, Statistics Canada reported that these barriers are placing the equivalent of a 6.9 per cent tariff on goods flowing between provinces, adding increased costs to forfeited revenue. This is more than twice the size of the average world tariff on goods which now sits at roughly 2.9 per cent.
We recommend the federal government follow Alberta’s lead to reach an agreement and eliminate unnecessary burdens to growth that continue to cost the Canadian economy everyday.
This is one of the 12 recommendations across five pillars that we are have put forward to all parties in our joint federal election platform with the Edmonton Chamber of Commerce. We look forward to working with the provincial and federal governments to ensure that all non-tariff barriers to internal are lifted across the country.