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By Jayson Myers

On December 7, Prime Minister Stephen Harper and US President Barack Obama released the details of the joint Perimeter Security and Economic Competitiveness Action Plan. This included the results of the Beyond the Border Working Group (BBWG) and the Regulatory Cooperation Council (RCC), both of which defined ambitious, yet necessary, improvements to our common economic space

While our leaders will deservedly get credit for their ambitious plan, along with hopefully ­fixing many of the trade irritants within our economies — such as improving border security, reducing the amount of duplicative and unnecessary data obstructing the movement of people and goods, harmonizing regulations, and streamlining regulatory approval processes — this announcement must not be seen as the ultimate solution or the end of the dialogue between our countries focused on strengthening the global competitiveness of our integrated economies.

Canada and the US must use progress through the BBWG and RCC to launch into a new, even more ambitious discussion on our future.

When Canada and the US signed the 1988 free trade agreement, trade between our countries was roughly $150 ­billion annually. The FTA, signed in part because of the shared success building a stronger and more integrated automotive industry under the 1965 Auto Pact, was designed to deepen economic integration and create more globally competitive companies.

It worked.

Trade between our countries in 2011 will reach nearly $600 billion dollars, fuelled by integrated global leaders in sectors such as technology, automotive, aerospace, energy, consumer products, pharmaceuticals and other health products, as well as food processing.

The deep integration of these sectors, and others, and the millions of jobs they support, is the success. The failure has been the regulatory system that supports these sectors, which was never modernized under the FTA, or since, despite several attempts. As a result, our economies suffer under the burden of complex, overlapping, duplicative and misaligned product standards and border processes. Despite integrated manufacturing, many products cannot be designed, tested and built for sale in both countries - all a result of slight differences in regulatory standards.

The costs of antiquated regulatory and border policies are too significant to ignore. They cost Canadian companies between $15-30 billion annualy. Furthermore, they reduce corporate investment in employees, production capacity, and innovation.

The Harper and Obama announcement on December 7 laid the framework to fix some of these challenges faced by companies. Even a 10 per cent improvement in regulatory ­harmonization — which should certainly not be the goal, as it is far too low — would result in a $5 billion return to the economy and a significant improvement in the global competitiveness of our industries.

But again, this should only be the beginning.

Canada and the US must now begin the process of an even more ambitious alignment of our economic interests within the global context. Specifically, we should be ­negotiating a new comprehensive economic and trade agreement that ­recognizes the deep integration of our industries and ­covers crucial elements of competitiveness, such as innovation, government procurement, infrastructure, foreign trade agreements and export promotion, workforce skills development and labour mobility, intellectual property protection, and energy ­independence.

An agreement covering these strategic areas would build on similar sector agreements, such as those in strategic defence industries, and provide a base on which our companies can become more innovative and productive domestically and much more competitive globally.

That's what will create jobs on both sides of the 49th parallel and will put Canada and US in the fast lane to prosperity.

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