Jack Mintz is director of the School of Public Policy at the University of Calgary. Claude Montemarquette is chief executive officer of CIRANO.
Canada has a major opportunity to position itself for sustained growth in the decades ahead. This opportunity is the creation of a new Northern Corridor, a multimodal infrastructure project (road, rail, pipeline, electricity generation and transmission, air and seaport facilities). It would connect Canada from sea to sea to sea and allow tidewater access to international markets for our renewable and non-renewable commodities.
We have been there before. Just as the national railway, the Trans-Canada Highway, the pipeline network and the St. Lawrence Seaway opened up trade and commerce in the 19th and 20th centuries, a Northern Corridor in this century will not only help get product to diverse markets but also further exploration and development in Canada's north and near north.
The time is right. Into the foreseeable future, we have prospects for economic growth that would benefit from a major investment in infrastructure – up to $100-billion over 10 years. We have a historically low cost of capital. We have minimal materials and labour cost pressures. If we plan now, we will be ready to take full advantage of the next upswing in the commodity cycle. Otherwise, the current, already high opportunity cost of not being able to get product to market will be even higher under resurgent demand conditions. Indeed, inaction could result in a permanent loss for commodities whose demand is subject to long-term secular decline or to unforeseen, game-changing technology.
The School of Public Policy at the University of Calgary is partnering with CIRANO, the Montreal-based Center for Interuniversity Research and Analysis on Organizations, to form a pan-Canadian research network on this subject. We will test the hypothesis through studies on routing options and rationalization with existing infrastructure; the respective public and private sector business cases and financing options, including aboriginal participation; public policy framework issues; national, regional and local socio-economic impacts; and environmental assessment.
As an interim step, we will publish a comprehensive issues paper for publication by this fall in order to help inform the detailed research program and to engage Canadians more broadly.
We are researchers, not advocates; but we are also oriented to practical policy action. In this regard, we will seek to evaluate critically the prospects for the anticipated benefits of a Northern Corridor. These include:
1. A significantly more efficient and reliable transportation system that would assist in re-establishing our competitiveness in global markets and, as well, our brand as a destination of choice for new investment in resource development.
2. A major positive impact on growth and jobs at a national level and significant, sustained, regional and local opportunities, especially for communities in the north and the near north.
3. Rationalization of Canada's overall transportation system, easing congestion and reducing risk of adverse impacts in the southern portion.
4. Strategic importance in helping to achieve Canada's goal of diversifying export markets, the long-term lifeblood of our resource sectors.
5. Enhancement of Canada's negotiating leverage in trade and commercial relations with international partners.
6. Promotion of Canada's Arctic sovereignty goals.
7. Optionality on routing, thereby creating flexibility in coming to win-win contractual arrangements and in mitigating adverse effects.
8. A major public-private, nation-building initiative, with governments setting the policy framework and related legislative/regulatory regimes and tax/expenditure programs; and aboriginal communities engaging based on their land rights and development aspirations.
In recent years, Canada's transportation infrastructure challenges have been addressed in a piecemeal fashion and accompanied by a lack of public consensus on the social acceptability of resource exploitation and transportation. We believe that continuation on the current course will result in a huge opportunity cost in terms of wealth not generated – for business growth, for government revenues, for employment opportunities and for vibrant communities.
It's time to look seriously at a different approach that will help shift the discourse from one of confrontation to collaboration.