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Canadian border guards are silhouetted as they replace each other at an inspection booth at the Douglas border crossing on the Canada-USA border in Surrey, B.C., on August 20, 2009.

DARRYL DYCK/The Canadian Press

Canada will be watching closely to see whether a massive scheduled budget cut in the United States this week will affect the Beyond the Border pact between the two countries, Foreign Affairs Minister John Baird said Wednesday.

Unless polarized U.S. lawmakers can come together, about $85-billion (U.S.) in cuts are set to hit federal programs starting Friday.

Homeland Security Secretary Janet Napolitano said this week there would be pain for the Canada-U.S. border because her department would have to cut 5,000 border-patrol agents if the cuts go through.

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Mr. Baird said the deal is key to the prosperity of both countries.

"We're going to continue to be very, very focused on it," he said Wednesday. "After March 1, we'll see what challenges arise. Obviously, this is not the way Canada would prefer to make these types of budgetary decisions. But it is what it is."

Prime Minister Stephen Harper and U.S. President Barack Obama signed the vaunted border deal 14 months ago.

It is designed to speed trade across the 49th parallel while protecting the North American continent from terrorist threats.

Ms. Napolitano said the looming cuts, known as sequestration, will cause pain for Canadians, in particular at the busy Canada-U.S. border.

"Sequester will be felt up there because there's only a few big crossing places for trade on the Canadian-U.S. border and they're really important crossing places," Ms. Napolitano said in a speech to a Washington think tank.

"In fact, trade-wise, they're probably the No. 1 or 2 crossing places in the world. As sequester evolves and we have to furlough people who are port officers and not fill vacant positions, and not pay overtime, we're unfortunately going to see those lines really stretch."

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If Congress fails to reach a deal to avert the cuts, Ms. Napolitano said, the jobs will be lost.

Cuts to customs and border security staff will increase congestion and hurt Canadian companies, said Fen Hampson, director of the global security program at the Waterloo, Ont., Centre for International Governance Innovation.

"More generally, if there is a slowdown in U.S. growth as a result of sequestration's general adverse impact on the U.S. economy as many predict, it will also hurt trade," he said. "There is no win with sequestration and the current impending disaster underlines how far we really have to go to secure a meaningful beyond-the-border deal."

In addition to the 5,000 border patrol agents, the U.S. Customs and Border Protection is preparing to reduce its work hours by the equivalent of 2,750 inspectors as well, meaning cargo inspections at the border could drag on interminably for Canadian exporters.

David Jacobson, the U.S. ambassador, has said repeatedly that the best thing his country can do for Canada is to get its fiscal house in order.

With this latest round of gridlock gripping Washington, various U.S. federal departments and agencies are laying out how they plan to cut costs.

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The Pentagon will be forced to impose $55-billion in cuts and will call on 800,000 civilian employees to take unpaid time off.

Ms. Napolitano's remarks raise questions about the future progress on the border deal. In part, its success will be measured on the implementation of a series of pilot projects between the two countries.

"Sequestration is also going to make it much harder to get the attention of the White House and those who are friendly to making a deal with Canada in the U.S. Congress," Mr. Hampson said.

In December, the two countries said in a progress report that they'd made significant progress but realize there's still much work to do.

One outstanding project is the next generation of cross-border law enforcement, which will see police and security officials work even more closely than they do now.

It would build on joint border-policing efforts by creating integrated teams in areas such as intelligence and criminal investigations.

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Two pilot projects were supposed to be up and running by last summer, but the progress report says officials are still evaluating the "operational and legal requirements" involved.

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