Posted yesterday at 11:00 a.m.
In recent days, many Canadians have watched in disbelief as protesters easily block many access points between the United States and Canada. For six long days, the Ambassador Bridge, this key trade route that connects the city of Detroit in Michigan to that of Windsor in Ontario, was blocked, forcing trucks to redirect to Sarnia. Other border crossings suffered similar fates in Manitoba and Alberta.
Many shipments experience significant delays and the contents of some aged or spoiled shipments are wasted. Blueberries, green vegetables – more waste and more costs for industry and consumers. Statistics Canada inflation data released this week tells us that border issues are contributing to higher prices in the country. now the Trudeau government is invoking the Emergency Measures Act.
For our international reputation, the Trudeau government had no choice. People can disrupt cities like Ottawa, Quebec, Toronto, Montreal, Halifax, but the risks take on another dimension when trade between two countries stops.
The backbone of our economy
If supply chains are the backbone of our economy, the border is its spinal cord. The shock waves of these closures are felt immediately. Manufacturing plants had to close and it took just a few hours for the White House to call Prime Minister Trudeau to express their concerns.
If some Canadians were unaware that the international border between Canada and the United States has been a central concern of both economies over the years, they surely know it now.
Keeping the world’s longest border open, peacefully and without disruption, is no small feat. It took decades to foster a spirit of interdependence between the two countries, especially for the agri-food sector.
Over the past year, Canada was the second largest market for US agri-food exports, totaling over $26 billion, or 15% of total US agri-food exports. At the same time, the United States imported $30 billion worth of agri-food products from Canada. This border is very busy and without it, the food security landscape in Canada would be very different.
Economically, few consequences will result from these border closures. Companies will be able to overcome this crisis, especially in food distribution. Since empty shelves are bad for business, importers and exporters will do anything to prevent us from leaving grocery stores empty-handed. The damage, however, goes beyond the numbers.
Tarnished reputation and “Buy America”
Our country’s reputation has been hit hard by border issues. To be summoned to act by Washington was simply embarrassing. Confidence in Canada as a trading partner will surely be shaken. Canada, after all, is one of the most peaceful countries in the world.
Canada, the smaller and less economically influential partner of the two, has a lot to lose. The United States has more logistics options. The forced closing of a border will have potentially long-term consequences.
This could persuade the United States to reconsider strategic alternatives or change its position on some thornier trade issues, such as softwood lumber and dairy.
Canada may even have just made the case for the proponents of the famous “Buy America”.
But consumers will be the most affected. It is to be expected that food prices will potentially increase beyond what was forecast just a few months ago.
Here’s another tile Canadians just don’t need these days.
Rethinking the supply chain
Logistically, the concept of using driverless vehicles using autonomous technology for small- and large-scale road freight transport has merit, perhaps more than ever.
Some companies have had to cut production due to supply problems caused by the blockades. This is prompting some companies to rethink transportation in North America and getting rid of humans behind the wheel is becoming a very attractive option.
All in all, for the sake of our food supply chain, there is nothing more disruptive than civil disruption.
Even events related to climate change, like the atmospheric rivers last fall in British Columbia, let us know what to expect.
But with civil disruptions, few know how long all of this may go on, and how far some are willing to go.
No matter how we look at it, Ottawa now has some serious diplomatic issues to deal with. Summon the Emergency Measures Act was the right thing to do for our reputation and for the trust of our international partners.