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- The Gateway Opportunity: Competitiveness and Attracting Foreign Investment
The Gateway Opportunity: Competitiveness and Attracting Foreign Investment
Experts are increasingly pointing to investments in trade-related infrastructure as essential to competitiveness and attracting foreign direct investment. This connection is rooted in centuries of history, with prosperity tending to concentrate along trade routes, and at their intersections.
Over the last 20 years, market-oriented policies in the Canadian transportation sector have contributed to productivity increases that far outstripped those in the economy overall. These gains have now tailed off. The policy and regulatory measures that drove these gains (commercialization, privatization, deregulation) were modespecific. Today, goods seldom move via a single mode of transportation. Achieving productivity gains through increased integration in the transportation system as it relates to global supply chains is a major driver for a gateway approach.
The new Yangshan deep-water port development near Shanghai required the construction of the 31.3 km Donghai bridge. The five berths currently operational (Phase 1) have an estimated annual capacity of 2.5 million containers (twenty-foot equivalent units). By 2020, the Port will have 30 berths and an estimated capacity of 25 million containers.
Rapid Economic Growth of China
The rapid economic growth of China is reshaping global trade flows, and the opportunities and challenges facing all trading nations, including Canada. Between 1995 and 2005, Canada’s exports to China more than doubled, from $3.5 billion to $7.1 billion. During the same period, Canada’s imports from China grew by almost 550 percent, from $4.6 billion to $29.5 billion, making it Canada’s second largest supplier of imports. China’s recent dramatic growth is expected to continue. Currently the world’s fourth largest economy, some experts predict it will be the second largest by 2016, and largest by 2041.
The "Shanghai to Chicago" Opportunity for Canada’s Asia-Pacific Gateway and Corridor
Canada is geographically positioned to prosper as the crossroads between North America and growing Asian economies, such as China, India and Korea, and of course Japan. Canada’s Asia- Pacific Gateway and Corridor offers world-class marine, rail, road and air infrastructure closer to Asia than all its North American competitors. Its population base also enjoys strong cultural, family and business connections with Asia- Pacific nations. These are major Canadian assets in international commerce.
Positioning the Gateway and Corridor to successfully serve the entire North American market allows its transportation providers to achieve significant economies of scale. The resulting efficiencies benefit exporters and importers alike, including western commodity producers who rely on the Gateway and Corridor.
However, to seize the opportunity, Canada must move quickly to address a number of challenges, including:
Capacity: Unprecedented increases in freight flows through Canada’s west coast are stretching existing infrastructure capacity.
Policy, regulatory and operating practices: Government policy and regulatory requirements, and private sector operating practices, impact the efficiency and use of the Gateway and Corridor — and investment in it.
Governance: There is no single "owner" of the Gateway and Corridor. All levels of government and the private sector must work in partnership to address the full range of measures necessary for a truly integrated approach. Governance arrangements must foster maximum efficiency in the use of existing assets.
The Role of Your Federal Government
The federal government is responsible for fostering the national transportation system’s efficiency, safety, security and sustainability in all modes. These fundamental objectives are pursued through marketplace framework policies, regulations, statutes and infrastructure investments. The federal government is also responsible for secure and efficient administration of Canada’s borders, for pursuing Canada’s interests in international commerce, and for positioning Canada to compete and prosper in the global economy.
The Integrated Gateway Approach
Transportation gateways are complex systems with many moving parts, all interconnected. The “gateway” approach is a policy and investment strategy built on the following principles:
- A gateway is a system of marine, road, rail and air transportation infrastructure of national significance for international commerce, within a defined geographic zone.
- A gateway strategy must address, in an integrated manner, a range of investment, policy and regulatory issues that impact the efficiency and reliability of that system.
- It must also address, in a highly targeted manner, major non-infrastructure and non-transport issues vital to the development or exploitation of the gateway.
- Partnership is not just a slogan. Key elements of gateways are owned by both public and private sectors, and regulated and taxed by all levels of government. Integrated and coherent action therefore requires real partnership based on consensus and a shared vision driven by stakeholders.
- Commitment is about more than maximizing public investment. Private investment is extensive and ongoing in rail, port, and airport infrastructure. Governments must set the right climate for private investment in gateways, while safeguarding the public interest.
A National Policy Framework for Strategic Gateways and Trade CorridorsA limited number of regions in Canada are potential targets for an integrated "gateway" approach, based on international trade and commerce volumes of national significance and transportation policy considerations. The Government of Canada is developing a national policy framework for strategic gateways and trade corridors that will guide future actions. It will draw on the key concepts and lessons of the Asia-Pacific Gateway and Corridor Initiative. Significant measures have already been taken to improve transportation infrastructure at the Windsor Gateway, and a bi-national process to select a new crossing is steadily advancing. |
The Asia-Pacific Gateway and Corridor Initiative responds to the challenges facing the Gateway and opportunities emerging in global commerce. It includes significant new investments, policies and regulatory measures to improve the efficiency and effectiveness of the Asia-Pacific Gateway and Corridor, and Canada’s exploitation of it. The Initiative also sets directions for ongoing collaboration, future actions and long-term strategy.
It is based on the following core elements:
STRATEGIC INFRASTRUCTURE
PRIVATE INVESTMENT AND INNOVATION
SECURITY AND BORDER EFFICIENCY
21ST CENTURY GOVERNANCE
POLICY RENEWAL
Asia-Pacific Gateway and Corridor Investments $591 million
Immediate Commitments: $321 million
Future Investments: $260.8 million
- Asia-Pacific Gateway and Corridor Transportation
- Infrastructure Fund $233.5 million
- Competitiveness Initiatives (non-infrastructure) $27.3 million
Moving Forward: $9.2 million
A fast-track process to identify further priorities, develop and implement long-term strategy and foster ongoing collaboration.
The $591-million Asia-Pacific Gateway and Corridor Initiative is part of an unprecedented level of support for infrastructure in Canada. The May 2006 Budget included a total of $16.5 billion in federal support for provincial, territorial and municipal