Canada’s transportation supply chains are near breaking point
A published in the Financial Post
Just over a hundred days have now passed since the Supply Chain Task Force’s independent report to the federal government indicated that “Canada’s transportation supply chain is nearing its breaking point.” And even though task forces are typically established to urgently address a problem in need of a solution, Canadian businesses are still waiting on concrete action to improve the transportation infrastructure and supply chains that serve as a cornerstone of our economy.
From the global pandemic to the wildfires and flooding in British Columbia, to physical disruptions due to blockades and strikes, our transportation system has suffered severe disruptions — some preventable and some unavoidable — that have stretched it beyond its limits.
The issue has only escalated, and we’ve run out of time. According to the latest Canadian Survey on Business Conditions Report, nearly a quarter of businesses continue to struggle to get the goods they need, putting operations and growth at risk. To position Canada as a strong competitor and reliable trading partner to our allies and grow our economy, the government must join forces with industry stakeholders to address the transportation supply chain crisis.
The path forward is clear.
First, while government isn’t solely responsible for infrastructure investment, its leadership is critical. A federal commitment to major, strategic, long-term investments is key to building Canada’s trade infrastructure – a crucial consideration as the government deliberates its next budget.
Without serious investment, we risk hindering Canada’s economic growth, competitiveness and international reputation as a reliable partner for business. With the current geopolitical crisis, the world needs more Canada, from the agriculture goods that we produce, to energy transported by rail and pipeline to products manufactured in Canada — we can’t accept trade infrastructure that doesn’t have capacity or can reliably transport goods on time.
Government needs to work with business to set clear priorities on infrastructure projects that will bring forward measurable economic returns as well as properly triaging projects that will put food on shelves, deliver the goods businesses need to operate and get Canadian products to global markets.
These projects should include safeguarding critical infrastructure that will ensure our supply chains can continue uninterrupted if a primary route is damaged or blocked. Others will expand rail in busy areas as well as increase bridge capacity to reduce congestion and speed up delivery.
Another critical step forward is developing a vision for Canada’s trade corridors.
Because Canada is a trading nation, our trade infrastructure matters. Two out of every three dollars that Canada makes rely on moving goods.
Trade corridors are key to this transportation of goods, and the government must look to work with business to develop new gateway strategies, including those for Western, St. Lawrence and Arctic Gateways.
Each corridor strategy would lay out how government would work with provinces, the private sector, communities and Indigenous peoples to identify capacity challenges facing our corridor transportation systems and develop a pipeline of actionable solutions.
Finally, the government must accelerate regulatory modernization.
Regulation continues to be a growing concern, with nearly 25 per cent of businesses that trade interprovincially citing red tape, such as differing certification and technical standards, as a major obstacle to doing business within Canada.
Regulatory effectiveness is integral to a competitive environment and requires regulating smarter to attract new economic opportunities to Canada.
Regulatory uncertainty and changing expectations in the regulatory process are a poison pill to those looking to invest billions of dollars developing new pipelines, new mines and other large-scale nation-building infrastructure projects. We need predictable timelines to encourage capital investment. It can’t take a decade to approve infrastructure projects. In this sense, streamlining the regulatory process and adopting strict timelines for approving major infrastructure projects is essential — and long overdue.
An efficient and reliable transportation network inclusive of trade corridors is key to Canada’s economic growth and partnership with countries in desperate need of stable, reliable trading partners. Without it, we are jeopardizing the success and livelihood of Canadians and their businesses as well as the growth and prosperity our country and our allies need. We can’t wait another 100 days for meaningful action.
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