Premiers' much-hyped internal trade deal hasn't amounted to much

On the day they released the Canadian Free Trade Agreement in 2017, all theprovincial and territorial trade ministers weregiven a symbolic pair of golden scissors to remind them to start cutting interprovincial trade barriers.

The trouble is, they aren't using them.

The scissorswere gifts from the Canadian Federation of Independent Business,a relentlessadvocacy group for whom harmonizing and ideally, cuttinggovernment regulations is a mantra.

Its president and CEO, Dan Kelly, said he's seen his snippy trophies proudly displayed in ministers' offices across Canada. But one year after the trade deal took effect on Canada's 150th birthday, July 1, 2017, has any tangible progress been made?

Well ...

"It's slow-going," he said. Theprocess lacks concrete timelines. He's still waiting for the interprovincialtrade committee to setpriorities, let alone rollbackbarriers.

"I don't think there's anything that has changed,other than a commitment to start some work," he said, laughing a bit when asked to identify which specific irritants have been settled between provinces inthe deal's first year of operations.

It's easier to point to reasons things stalled.

There's the pipeline debate in British Columbia and Alberta's threat to retaliate, for starters, which risks "undermining the whole spirit of this agreement," Kelly said.(Saskatchewan, another energy exporter,jumped into this fight too.)

It's also hard to maintain momentum across 13governments. During its time as chair of Canada'sinternal tradecommittee, Ontario's Liberal government (and specifically minister Brad Duguid) was a driving force in finalizing CFTA, which was announced at the premiers conference in Yukon in 2016 but not actually unveiled until the following spring in Toronto.

The chair has changed hands twice since then. Firstit swung toNew Brunswick home of the much-discussed Comeau case, in which thatprovince's right to stop its citizensfromstocking their personal beer fridges across a provincial boundary was upheld by the Supreme Court. Now it's Quebec's turn.

Ontario's recent change ofgovernment also delayed the distribution of a working group report on alcoholic beverages that was due byJuly 1 (more on thatlater).

This week's Council of the Federation meeting in Saint Andrews, New Brunswick will be Ontario Premier Doug Ford's coming out party as a Canadian first minister. His early actions suggest he's familiar with the gestures of internal free trade:he's appointed a senior civil servant, deputy minister Giles Gherson, as head of "red tape and regulatory burden reduction" in the cabinet office to "help make Ontario more competitive and open for business."

"There's been lots of focus on regulatory reform within provinces," Kelly said. "It's the collective work that is more complicated."

Pallister urging action

Meanwhile, to cite only one example shared with CBC News, long-haul transport companiesare still having to stop at the Manitoba border to change drivers and trucksbecause rulesin that province don't line up with the neighbours.

It's not cost-effective, at a time when facilitatingeast-west trade should be a priority in the face of uncertainty across the U.S. border.

The issues in his own jurisdiction didn't stop Manitoba Premier Brian Pallisterfrom writing to his fellow premiers last week, urging them to implementthe CFTA.

"Some differences in provincial and territorial regulations may be appropriate to address local safety considerations, but the trucking industry has raised regulatory inconsistencies that constitute barriers to fair competition," he wrote.

He also flagged other longtime poster children for interprovincial trade dysfunction:

• abbatoir licensing variations that have nothing to do with safety, but nevertheless inhibitthe shipment of provincially-inspected meat across internal borders;
• the need for nationwide businesses to register separately in each province in which they operate;
• occupational health and safety rules that require different types of first aid kits, depending on where you work.

But the most interesting part of his letter spills the beans a bit on the much-anticipated report from the alcoholic beverages working group.

Liquor announcement this week?

When the main CFTAwas negotiated, too much work remained to announce any progress on liquor sales liberalization, so it was puntedfor further study. CBCNews was told the report's recommendations have been circulated, but won't be made public yet.

Pallisteralluded to "consensus recommendations" on personal use exemptions, enhancing e-commerce platforms, online information, listing practices, pricing and "sales channels intended to enhance domestic trade."

Changing thepersonal use exemption, Pallister said, would "demonstrate immediate progress" but he also suggested "going even further, by fully removing those limits."

CouldNew Brunswickers soon make legal beer runs to Quebec? It wouldgive premiersa crowd-pleasing, populist headline to top their summer talks this week.But the committee of interprovincialtrade ministers officially tasked with reviewing the recommendations hasn't met yet, so it's not clear the premiers will preempt them.

CBCNews reached out to the current chair, Quebec's Economy Minister Dominique Anglade, but shewas out of the country last week. She won't be in New Brunswick this week either because she's attending the Farnborough Air Show.

'Difficult to land'

Despite a private members'bill passed six years ago, only three provinces (British Columbia, Manitoba and Nova Scotia) allow wine for personal use to cross provincial borders.

"We honestly believe that if they opened it up, then that would increase sales," said Dan Paszkowski, the president and CEO of the Canadian Vinters Association.

In the three provinces that opened up direct delivery of wine, sales are up,he said, citing his organization's data.

But don't be too quick to put a white hat on British Columbia. The province's rule that only B.C. wine can be sold in grocery stores has landed Canada in a trade dispute at the World Trade Organization with both the U.S. and Australia. Thiskind of provincial policy while a huge headache for Canada internationallymay not be dealt with by this report.

Beer Canada's president, Luke Harford,isn't expecting a lot of in-depth work or recommendations.

The membership of the working group isn't public, but itincluded representatives fromprovincial liquor monopolies, as well as trade and finance policy officials.

"It would have been really difficult to land and see things eye-to-eye, given their various backgrounds," Harfordsaid.

Alberta wants todiscussinternal trade issues at this week's meeting, Harford said, even as it announced last week it will appeal a recent court decision that found the supportit gives its own craft brewersat the expense of other provinces' beerviolates the Constitution.

"There's a lot of things that I think could be done... to open up Canada as one market and be more competitive at the international stage," he said.

NAFTA brings fresh urgency

Itcontinues to be illegal for a craft brewer on the Quebec side of the Ottawa River to market directly to thirsty Ontariansa short bridge strollaway.

"Provinces have a lot of autonomy," said Dennis Darby, the president and CEO of Canadian Manufacturers and Exporters. It's not that there's any ill will about the idea of change, he said it's just hard to break through.

When the CFTA was signed, all the talk was about international competitiveness as Canada's new trade deals with Europe (CETA) and Pacific Rim countries (now called the CPTPP) were finalized.In 2018, NAFTA and other U.S. trade disputes loom larger.

As the Trump administration threatens new automotive tariffs, for example, the economist for the Canadian Automotive Dealers Association told reporters earlier this month that one of the most important things Canada needs to do is cut internal trade barriers not because of a direct irritantto dealerships, but because of their overall drag on the economy.

"There's no practical reason, in 2018, that there should be any differences or any requirement for extra paperwork," Darbysaid."Canada is a nation of traders.

"We need someone to blink."