A robust IP regime stimulates R&D by allowing innovators to recover their costs, which can encourage investment in research and development, and the introduction and use of new drugs. It also encourages the creation of a market for knowledge and technology. However, the benefits of strong IP protection have to be balanced against potential increases in drug costs and the economic impact of rent seeking.

To conclude the CETA negotiations, Canada may have to agree to significant domestic policy changes in the areas of patent term extension, data exclusivity, and right of appeal for innovators. The results of these negotiations will set the parameters of Canada’s bargaining position on intellectual property commitments in the TPP negotiations. Unless the CETA results in significant domestic reforms, Canada may be faced with demands for more extensive IP commitments in the TPP.

The debate over pharmaceutical IP reform in Canada is highly polarized and interest-driven. There is a need for objective, exhaustive and independent analysis of the costs and benefits of stronger IP for Canada. Furthermore, should Canada agree to more extensive IP commitments in the CETA or the TPP, we should do in exchange for a commitment from industry to spend a certain percentage of sales on R&D in Canada.

The full paper including our recommendations is available here.

The United States is likely to try to retain tariffs on sugar. For Canada it’s dairy. Vietnam wants to keep protections for state-owned enterprises. Australia is opposing investor-state dispute settlement and New Zealand is likely to block measures that would affect its pharmaceutical pricing system.

As we begin the 17th round of negotiations in Lima, assurances that the talks would be complete by the end of 2013 seem unlikely. With a dozen economies now scrambling to put markers on the table for sensitive sectors while also trying to address the regulatory realities of an integrated, digitized global economy, it appears that the honeymoon is over and the real work has begun.

Excerpt from feature article, forthcoming from Public Diplomacy Magazine, Summer 2013.

The Great Lakes-St. Lawrence Region is comprised of two provinces, eight states, over forty First Nations, and numerous Canadian and U.S. regional authorities. With a population of 105.6 million, a $4.5 trillion GDP and supplying 18 percent of the world’s fresh water, “the Great Lakes are the heartland of North America and support one of the most vibrant economies in the world.”1

The positive global impact of the region is evident. If it were a nation state, it would represent the 4^th largest economy in the world. Cross-border trade supports 2 million jobs, and the region is rich in oil and natural gas deposits. With an area of 95,000 square miles covered with fresh water, the Great Lakes region is a world leader in the generation of hydroelectric power.

However, the region faces many challenges that stem from state and provincial legislatures, businesses, academics, and NGOs, working in different directions. More profound collaboration is needed across borders and among all sectors, to make progress on the particular economic and environmental issues of the region and to make the Great Lakes voice heard in Washington, Ottawa, and around the world.

Although there are a number of national and cross-border organizations within the Great Lakes dealing with various economic and environmental issues, there is no single organization that deals with the economic transformation, prosperity, and sustainability of the region in an integrated way.

The CGLR fills a void by speaking for the region’s interrelated long-term economic and ecological interests and by furthering these objectives through a series of tangible projects.  These include:

• Economic impact of declining Great Lakes water levels – to provide a comprehensive economic evaluation of the impact of low water levels on specific sectors across the Great Lakes-St. Lawrence region.
• Mutual skills recognition for regional workforce development - to facilitate regional recognition of highly skilled worker certifications and to more efficiently respond to skilled labour shortages.
• Great Lakes-St. Lawrence Region tourism initiative- to develop a bi-national tourism plan, including the creation and marketing of vacation programs, hike/bike trails, and the designation of a world heritage biosphere.
• Reduction of regulatory, border and capacity barriers to Canada-U.S. trade, especially in the SME sector.
• Building coherence in regional security issues such as emergency preparedness and threat assessment.

With a solid foundation in place, CGLR’s next steps are to work with partners throughout the Great Lakes to identify and act upon regional priorities.

This summary is drawn from a longer report available here 

I don’t have firsthand knowledge of Blackfire, the Canadian mining company that is alleged to have caused environmental damage in Chiapas, Mexico, bribed local officials and been implicated in the killing of a local activist.  If the allegations are true, Blackfire has made the work of other Canadian companies in foreign markets much more difficult.

I do, however, have firsthand knowledge of how Canadian diplomats represent the interests of Canadian businesses abroad.  As an international trade consultant, I have worked alongside Canada’s economic, political and trade officials in the Americas, China and the former Soviet Union.  Our diplomats are uniformly professional and thoroughly “by-the-book”.

Just because a company is accused of bad acts abroad, Canadian diplomats cannot adopt a presumption of guilt and refuse to take the company’s phone calls, anymore than they would if the case involved a private Canadian citizen accused of breaking a local law.  Such allegations are likely to become more frequent in the future as Canadians diversify their trade to emerging markets – many of which have legal systems that are at best distinct from Canada’s and, at worst, downright corrupt.

Because Jim Munson’s article is based on a lengthy report by lobby group Miningwatch, taken from redacted government documents, it is hard to know what really happened.  But, according to the iPolitics text, the only misdeed for which there is some degree of consensus is that Blackfire damaged local roads with a company truck.  Maybe Blackfire did everything else they are accused of and then some. There is recourse through criminal and commercial courts to figure this out.  But Canadian embassies have neither the staff nor the training to make legal determinations about guilt or innocence before they provide assistance to a Canadian company abroad.

It seems to me that the staff of Embassy Mexico did everything we can reasonably expect of them.  Given embassy reductions in funding, it is amazing that an officer had time and funds to travel to Chiapas, some 1000 kilometres south of Mexico City, visit the mine, talk to local officials and report to the ambassador and DFAIT in Ottawa. Ambassador Rychinski then took the prudent course of telling his staff to back off from the unfortunately named Blackfire. That’s what we send them abroad to do on behalf of our nation, our citizens, and, yes, Canadian business.

At a time when Canadian companies need DFAIT advice and expertise to help them compete successfully in complicated and distant markets, our diplomats perform their duties with confidence and professionalism and they do not retreat to the shadows at the first whiff of criticism. We should expect nothing less.

By Jeffrey Phillips, Energy Consultant and Guest Contributor

The terms “game changer” and “revolution” are typically used to describe the shale gas phenomenon in North America, and rightfully so.  The combination of horizontal drilling and hydraulic fracturing (or ‘fracking’) has made the recovery of natural gas from shale economically viable, leading to increased natural gas production, record high storage levels, and overall low prices.

One of the more significant implications of cheap and abundant gas has been the effect on liquefied natural gas (LNG) markets.  LNG is created when natural gas is cooled to -160 degrees Celsius where it takes a liquid form (which takes up 600 times less space than the gas) that can be transported by ship and used for purposes like heating and power generation.

Whereas the early to mid 2000s saw an investment boom in LNG import facilities, driven by concerns over dwindling domestic natural gas supply, by 2008 the market had shifted dramatically and most of the proposed projects were wiped off the table, only to be replaced with proposals for LNG export facilities.

BC is front and centre of the LNG export story in Canada, and the province has recently produced an LNG strategy to guide the development of this new industry.  There are now five proposed export facilities along the B.C. coast that would facilitate the export of LNG to markets in Asia.  Global LNG demand is expected to double by 2020, about the time when some of the proposed projects could come online.

Beyond the export of LNG, there is a strong commercial interest in increasing the use of natural gas in the transportation sector.  Shell, which is at the forefront of promoting alternative uses for LNG, recently opened its first LNG refuelling station in Canada in Calgary.  Around the same time, the company also announced a final investment decision in a small LNG liquefaction plant in Sarnia, Ontario that would provide LNG as a fuel for ships plying the waters of the Great Lakes.  Rail applications are in the mix too.  For example, BNSF Railway in the United States recently announced plans to test a small number of locomotives using LNG.

Coming full circle in an ironic twist on the “what else can we do with all this cheap abundant gas?” story, natural gas producers operating rigs in the Marcellus basin are starting to switch from diesel to LNG to power their rigs. As long as supply remains high and prices remain depressed, efforts to increase alternative uses of natural gas will likely intensify.

Jeffrey Phillips is Principal, JPT Energy Consulting and can be reached at jptphillips@gmail.com

By Stefania Bartucci

Receiving this year’s budget, I felt like a kid at Christmas who was really hoping that Santa would pony up for a Nintendo Wii, and instead discovered some new socks and pajamas under the tree.  You know you need them, but socks and PJs won’t entertain you for hours on end.

No matter. Although this budget didn’t introduce anything revolutionary for the Canadian trade community, there are a few stocking stuffers worth mentioning.

A Super-Department

Faster than a speeding bullet, more powerful than a locomotive…well, that might be overstating its powers, but this budget does fold the Canadian International Development Agency (CIDA) into the Department of Foreign Affairs and International Trade, creating a new super-department: the Department of Foreign Affairs, Trade and Development. The new department’s mandate will include “advancing Canadian interests and values on the international stage,” suggesting that development and trade objectives will continue to be closely linked. Canada’s international development community has had mixed reactions. On the upside, it’ll be a strong quarter for some lucky stationary suppliers.

A Shiny New Trade Strategy

Yes folks, the long-awaited Global Commerce Strategy, announced in Budget 2012 will be released in (drumroll, please)…the coming months. This is government-speak for “No kids, we’re not there yet and if you don’t stop complaining, I will turn this car right around.”

New (Old) Friends

This budget reaffirms the government’s commitment to achieving bilateral trade agreements with the European Union, India, and Japan, and to opening new markets in Asia via the Trans-Pacific Partnership. More on this in Budget 2012.

Tariff Regime 2.0

Canada’s General Preferential Tariff Regime provides duty-free or preferential market access to imports of most products from 175 designated countries. Long overdue for an update (it was implemented in 1974 and hasn’t been modified since), the government is following through on its commitment to remove 72 countries from the current list, and renew the GPT for a 10-year period. Although many less-developed countries remain on the list, this change will make imports from countries such as Brazil, China and India more expensive for Canadian manufacturers. And, since Canada does not have trade agreements with many of these countries, there is no quick remedy to receive tariff-free access. According to the budget, these changes will result in savings of $1.1 billion over the next five years.

Better Borders

As part of the commitments made in the Beyond the Border Action Plan, the government will upgrade border infrastructure at select ports, implement a single-window system for submitting data electronically to expedite cross-border shipments, harmonize Canadian and US trusted trader and traveler programs, and enhance customs facilities at the port of Vancouver and pilot projects at the ports of Prince Rupert and Montreal.

Wait, Canada has Foreign Trade Zones?

Well, they’re not exactly Foreign Trade Zones, but the government does offer exporters some tax and duty advantages that resemble the privileges of one. Foreign trade zones are globally recognized programs that provide financial incentives for value-added manufacturing of low-cost material and processing of goods prior to export. FTZs allow firms to defer duties or taxes thereby lowering their operating costs. (Free time on a Sunday afternoon? Read more here). Canada does not have designated foreign trade zones, but it does have FTZ-like programs. This year’s budget committed to simplify the application process to these programs and eliminate the annual registration fee for the Customs Bonded Warehouse Program.

With a possible conclusion to the Canada-EU negotiations this year, and the government’s ongoing emphasis on the international trade agenda, this budget won’t be the last word on trade for 2013. There’s hope for that Wii yet…

The U.S.-Canada border and U.S.-Mexico border are very different.  If we, as a trilateral community, attempt to promote a comprehensive approach, there is a possibility that lessons learned from one area could generate positive spin-offs elsewhere.  On the northern border, our primary focus is speedier, more efficient access for trade and tourism.  On the southern border, trade and tourism are overshadowed by immigration and narco-trafficking.  Even with Mexico’s social and economic fortunes on the rise and fewer Mexicans are heading north, Mexico is still a thruway for Central Americans en route to Gringolandia.

Maybe the borders really are too different and that the interests of north and south are frustrated by trying to turn multiple experiences into a single story.  On the other hand, if Canada were to reach out to Mexico directly, rather than permit all interactions to be mediated by the United States, the real spirit of trilateral cooperation among equal partners might finally emerge.

Click here to read the essay.