Hello, everyone.
I am pleased to be here today.
Madam Chair and members of the committee, thank you very much for the opportunity to appear before you again today.
The last time the chair and I were together was just a few short weeks ago at a parliamentary address and then a dinner that Canada hosted for the President of the United States. I did not travel up on Air Force One, however.
On the heels of President Biden's successful visit to Ottawa, we have a number of ideas about how to advance the world's most successful trading relationship. Today I will focus on one that cuts across every single sector in our joint economic space.
North Americans may not have heard of the Canada-U.S. Regulatory Cooperation Council, but whether you're a C-suite executive, a shareholder, a small business owner or just someone doing some shopping, the RCC is working to tackle the red tape and regulatory burdens that often vex consumers and businesses alike, not to mention the regulators themselves.
Differing national regulations and standards determine, for example, whether a product can go to market in Canada or the United States, which explains why Canadian consumers, for example, may be frustrated when they can't buy or access products they see advertised in the American media and vice versa.
An even bigger problem is that this tyranny of small differences reduces cross-border commerce, making it nearly impossible for many small businesses to build their customer base and grow their companies in neighbouring jurisdictions.
Indeed, differing regulations between the U.S. and Canada—the world's most successful trading partners—have had the unintended consequence of hindering the flow of goods and services in our integrated economy, raising prices and eating into business productivity and profitability on both sides of the Canada-U.S. border.
For the past 12 years, the Regulatory Cooperation Council has been committed to ensuring that the rules and regulations involved in doing cross-border business are aligned whenever possible between the U.S. and Canada. The council also protects the health and safety of citizens and the environment on both sides of the border.
In a period of economic volatility, supply-chain challenges and extreme climate change events, these are especially important responsibilities, yet they've been semi-neglected in recent years.
The Canadian American Business Council successfully called for the creation of the RCC back in 2011. At our urging, the RCC was launched by President Barack Obama and then prime minister Stephen Harper to great fanfare among businesses on both sides of the border.
In its early years, the Canadian bureaucracy did most of the heavy lifting for the RCC—and that continues today, actually—first via the Privy Council and then via the Treasury Board Secretariat. In the United States, a White House entity with the Office of Management and Budget—the Office of Information and Regulatory Affairs, or OIRA—plays that role.
Then came the Trump administration. To put it diplomatically, Canadian officials didn't find the Trump White House quite as easy to deal with. Long overdue efforts, actually, to renegotiate and modernize NAFTA, the North American Free Trade Agreement, now the USMCA or CUSMA, necessarily took centre stage.
Regulatory harmonization concurrently took a back seat, which is ironic, because the small and medium-sized companies most plagued by regulatory hurdles are the very firms that the U.S., Mexico and Canada want playing a greater role in North American trade under the USMCA.
It's time, then, to redouble our efforts. The timing, in fact, couldn't be more apt for a vow renewal, if you will, in a harmonization relationship that's grown more vital in light of global circumstances. The current economic realities demand attention and action.
The COVID-19 pandemic has vividly illustrated the vulnerabilities of our supply chains. Regulatory obstacles pose even more headaches for those navigating tenuous supply chains, but the pandemic also showed us that we can work across borders to deploy personal protective equipment and life-saving vaccines. We must use what we have learned since March 2020 to help the North American economy rebound by tackling counterproductive regulatory redundancy. Doing so will boost efficiencies in cross-border trade and ease supply chain woes, while cutting costs both for governments and for businesses of all sizes, as well as for everyday Canadians and Americans.
U.S. President Joe Biden and Canadian Prime Minister Justin Trudeau have acknowledged that regulatory co-operation can promote economic growth, competitiveness and innovation and create jobs while protecting high standards of public health, welfare, safety and environmental protection. Kick-starting the RCC's efforts to achieve more regulatory harmony will bolster supply chain resiliency between the U.S. and Canada in crucial sectors that include medical devices, PPE, critical minerals, semiconductors, electric vehicles, batteries, solar energy and much more.
Regulatory differences are unintended trade barriers between the United States and Canada, and we are so grateful to this committee for taking on this important issue. Let's get back to work on the RCC.
Thank you very much.