The Bi-Coastal Gateway to North America
Canada’s national government has developed and is now implementing a series of gateway and corridor strategies in order to become the preferred route into and out of North America.
Christopher Steele, Global COO and North American President, Investment Consulting Associates (ICA) (Location Canada 2013)
While our Great White North neighbor is one of the United States’ largest trading partners, Canada also has a grand history of shipping and logistics ties to Europe and Asia. The nation’s vast reserves of natural resources and its own innovation and manufacturing prowess have found favor in markets around the globe. Logistics and freight movement are now the areas of excellence that Canada aspires to, and the country is building a set of strategies to become the preferred gateway into and out of North America.
To do this, the national government has developed and is now implementing a series of gateway and corridor strategies across the country. Each is a direct partnership between Transport Canada and all of the affected provinces. The strategies are intended to provide a comprehensive approach toward transportation, defining each gateway as a multimodal entry/exit point through which goods and international passengers move through local, regional, and international markets. Each gateway then connects through one or more trade corridors, defined as a multimodal linkage of international passenger and/or freight flows between major markets.
Each of the three gateway strategies (Atlantic, Ontario-Quebec, and Asia-Pacific) is intended to be an integrated package of policy and long-term infrastructure investment to advance Canada’s strategic advantage for logistics and economic development. Execution of each strategy has explicit steps including:
- Infrastructure — Through examining the current and expected demands and capacity upon key facilities in the transportation network, the country and provinces are determining where to make key investments. This includes identifying and eliminating critical barriers
- Promotion and marketing — By understanding how markets are changing, the country is developing plans for marketing and trade missions to specific industries around the globe.
- Border efficiency and security — International trade involves border crossings by definition. Canada’s strategies hinge on having security measures that are robust and still allow for the timely passage of goods and passengers. The U.S.-Canada border is of particular importance, and Transport Canada has been working with its U.S. counterparts for years to develop effective practices.
- Policy and regulatory issues — The government is explicitly working with the private sector to understand how policies impact business and to develop regulations that minimize undue negative business impacts, while achieving a safe, secure, efficient, and environmentally responsible transportation system.
- Technology — Strategies include developing systems that maximize the ability of the transportation system to improve accessibility, ease traffic and congestion, and limit the adverse impacts of freight and passenger movement in areas such as the environment.
- Knowledge and skills — As part of the overall policy, the government is making investments in education and work force development to ensure that there is a robust skills base available to both industry and the public sector to allow for the continued sustainability of the system.
- Governance — The gateway approach depends upon partnerships and collaboration across modes of transportation, across borders, and across the public and private sectors. Policies and investments are specifically intended to complement market-oriented transportation needs, while creating a positive climate for private investment and also safeguarding the public interest.i
Each of the gateways is taking an approach that includes each of the above steps, but with an eye toward its specific circumstances and opportunities going forward.
East Coast Gateways
In 2010, Transport Canada — in cooperation with the provincial governments of Nova Scotia, New Brunswick, Prince Edward Island, and Newfoundland & Labrador — published a full “Atlantic Gateway and Trade Corridor Strategy.” This plan was an explicit attempt to build opportunities for the region’s economic success through positioning it as a logistics center linking Europe to the North American heartland. The plan’s vision speaks for itself: “Canada’s Atlantic Gateway and Trade Corridor is a strategic, integrated, and globally competitive transportation system for international commerce to and from North America.”ii
The Atlantic region already handles significant levels of international trade, and exports already contribute to about one third of the region’s GDP. Significant export markets include refrigerated cargo, agriculture, forestry, energy, minerals, and several manufactured products. The provinces have also placed a priority on energy and container trade, with specific targets in Africa, Central America and the Antilles, Europe, the Middle East, and North and South America.
The Asia Pacific Gateway
First announced in 2006, Canada’s Asia Pacific Gateway and Corridor Initiative (APGCI) is a network of transportation assets and corridors across western Canada. By investing in infrastructure, the Canadian federal government plans to strengthen the country’s overall trade position, particularly as it concerns trade with Asia. Main investments include strengthening road, rail, and air connections between the Pacific ports of Vancouver and Prince Rupert and various production and logistics centers across the country.iii
The initiative is also aimed at making the Canadian transportation network a more attractive alternative to companies in the U.S. Pacific Northwest and Midwest looking to move materials to and from Asia. The initiative focuses on gateways and corridors, providing fully integrated ways of moving goods between North American and Asian markets. For example, by investing in the Canadian National and Canadian Pacific railroads — as well as in infrastructure at key border crossings — the Canadian transportation network can provide a seamless, one-carrier network to bring materials from Asia to markets such as Memphis, Minneapolis, and Chicago.
The Central Passage
While not as world-changing as the fabled Northwest Passage, the Ontario-Quebec Continental Gateway and Trade Corridor is the third major corridor and perhaps the most immediately significant to the nation’s plans for economic growth. The Ontario-Quebec set of logistics channels differs somewhat from the Atlantic and Asia-Pacific in the following ways:
- Consumer population and production density — This gateway corridor provides direct access to major North American markets with over 135 million consumers over a very short distance (roughly 1000 km).
- Existing economic presence — Investment in this corridor is necessary to maintain economic health, as it is already the main economic corridor of Canada. The government estimates the value of trade in the corridor at about $560 billion, or roughly three times the combined value of trade in the two other Canadian gateways.
- Integration with existing multimodal Infrastructure — The multimodal transportation system already supports the formation of a formal corridor organization. The region’s infrastructure includes four modes along the St. Lawrence-Great Lakes corridor and connects to the North American heartland.
In each of the three major corridors, a clear agreement has been signed among the affected provincial governments, as well as the government of Canada. Each also has identified an explicit coordinator to reach out to its counterparts in the United States. Each strategy has outreach to the partners in the United States as an explicit work task.iv
and a Comprehensive Framework
While each of these initiatives has provided advantages for Canada, Transport Canada has been working to collect and interpret data across the national supply chain to seek out and address choke points and invest in other enhancements. Originally meant as a means for keeping an eye on Canada’s performance against the U.S. and Mexico, Canada’s data collection from private logistics and shipping firms measures the flow of goods from West Coast ports and through various channels in the national supply chain, and examines when and how they arrive at their destinations.v
The country’s commitment to working with private firms in a partner relationship (rather than looking solely on Customs data, for example) provides a much more robust assessment of what is actually happening across the system.
While the current phase of the project is focused upon goods moving from the West Coast ports to and from the interior, subsequent work will focus upon the supply chain between Antwerp as well as other European ports to cities in the Canadian and U.S. interior. Put another way, the data initiative will specifically build upon and enhance the existing gateway and corridor initiatives. In fact, the entire national corridor exercise and data infrastructure suggest an analogy to a private-sector network optimization exercise, but one which specifically brings the private sector and public infrastructure together in a comprehensive fashion. If successful, Canada could provide a new model on how to use freight and passenger transportation networks and data management to drive national economic development. All that remains to be seen are the results.