“The state of Canada-US relations remains marked by trade barriers that hurt Canadian producers and consumers and high-profile disputes,” of which Keystone XL is but one, the think-tank said in a press notice about the study.
Canada is the largest foreign supplier of energy to the US, according to the US Energy Information Administration.
Alexander Moens, Fraser Institute senior fellow in American Policy and a coauthor of the new study, said Canada has suffered a relative decline in competitiveness with the US since 2007.
Canada’s merchandise trade surplus with the US fell from $77 billion in 2008 to $35 billion in 2012, he noted. At the same time, Canadian service imports from the US are growing while its service exports are stagnant.
“To address these declines in both merchandise and service trade, Canada must push Washington to lower trade barriers inside North America and increase Canadian access to US markets,” Moens said.
The analyst noted that the Keystone XL project, proposed in 2008 to carry synthetic crude oil and blended bitumen from Alberta to refineries in the US Midwest and Gulf Coast “is by no means a new feature in Canada-US energy relations as a dense network of oil and electricity carriers already cross the border at multiple points.” Delay of action on the presidential permit needed for the border crossing, he added, has “chilled relations” between the US and Canada.
Other disputes include a US requirement for strict labeling of Canadian cattle and hogs, a controversial lumber agreement, and provisions of the American Recovery and Reinvestment Act mandating exclusion of Canadian products and production-sharing in US public-works projects.