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Regional Institute Releases Brief Exploring U.S.-Canada Trade, Receives National Grant to Research Border Performance

By Rachel M. Teaman

Release Date: October 30, 2008

BUFFALO, N.Y. -- Canada is by far the United States' most important trading partner, with exports to our northern neighbor totaling more than those to Mexico, Japan and China combined. Yet federal policies to reinforce security without slowing trade have had mixed results, with some border regions easing bottlenecks more than others.

These and other findings on the U.S.-Canada trade relationship are published in "Border Brief," a joint effort of the Regional Institute and the Border Policy Research Institute of Western Washington University. The brief examines border issues through a snapshot of export activity in October 2007 across two trade corridors -- Buffalo-Niagara Falls, N.Y., and Blaine, Wash.

The two institutes have received $11,500 from the recently formed Northern Border University Research Consortium (NBURC) to develop a "Border Barometer" that monitors the performance of the U.S.-Canada border. Both the University at Buffalo and Western Washington University participate in NBURC, along with four other universities on the border.

"Buffalo and Blaine are uniquely situated to serve as microcosms of the U.S.-Canada relationship," said David Davidson, associate director of the Border Policy Research Institute and co-author of the brief. "This brief, and the forthcoming Border Barometer, build a foundation of objective analysis to guide policies affecting all border regions along the 49th parallel."

Last year in October, typically the peak month for trade due to pre-holiday stockpiling, nearly 20 percent of U.S.-to-Canada exports crossed at Buffalo-Niagara Falls, while more than 5 percent crossed at Blaine, between Seattle and Vancouver.

In that same time period, U.S. exports to Canada were valued at $23.5 billion compared to $12.4 billion for Mexico and just $5.5 billion for China. While exports to Canada accounted for 20 percent of total exports for the nation, they comprised more than 50 percent for five states (Montana, Wyoming, South Dakota, North Dakota and Iowa). Canada was the largest export market for 36 states, including New York, and the second largest for 10 others.

According to the "Border Brief," among the federal policies that may be in need of attention is a package of pre-screening programs intended to bolster security while maintaining border flows. Different programs implemented by U.S. Customs and Border Protection and the Canada Border Services Agency screen freight loads, trucking companies, manufacturers and even truck drivers. Yet all components must be screened -- a costly enterprise for most shipping companies -- before trucks can cross via expedited FAST lanes. Consequently, participation in these programs is relatively low. At Buffalo-Niagara Falls, 23 percent of trucks use the FAST lanes to cross the border, while only 5 percent do so at Blaine.

"Part of the challenge here is the uniform implementation of federal policies across a wide range of border regions, each with different commodity flows, shipper profiles and traffic patterns" said Peter A. Lombardi, a UB institute policy analyst and co-author of the brief.

For instance, more agricultural products cross at Blaine relative to other regions; such products are harder to screen due to their complex supply chain. In contrast, trade across Detroit-Windsor, where 44 percent of trucks use FAST lanes, is dominated by a few large automotive companies and a small set of trucking companies.

"Rather than look to policy solutions at the continental level, policies that allow for some flexibility in regional implementation could improve border efficiencies without compromising security," Lombardi added.

"The lessons of this policy brief are eye-opening," said Kathryn Bryk Friedman, institute deputy director and head of the institute's Region's Edge research initiative on binational regions. "This collaborative brief demonstrates that the public, private and academic sectors must move beyond the security-economy dichotomy that currently frames debate and policy options. We need to push the conversation to a new level."

The "Border Brief" is part of the institute's Policy Brief series, which informs regional issues with timely, reliable data and analysis. All policy briefs are available online at http://regional-institute.buffalo.edu. It is also part of the Border Policy Research Institute's Border Policy Brief series, which can be found at http://www.wwu.edu/bpri.

The institute and the Border Policy Research Institute will release their Border Barometer findings in February 2009 at a conference to be held in Washington, D.C.

A major research and public policy center of the University at Buffalo, the Regional Institute plays a vital role in addressing key policy and governance issues for regions, with focused analysis of the Buffalo-Niagara region. A unit of the UB Law School, the institute leverages the resources of the university and binational community to pursue a wide range of scholarship, projects and initiatives that frame issues, inform decisions and guide change.

The University at Buffalo is a premier research-intensive public university, a flagship institution in the State University of New York system and its largest and most comprehensive campus. UB's more than 28,000 students pursue their academic interests through more than 300 undergraduate, graduate and professional degree programs. Founded in 1846, the University at Buffalo is a member of the Association of American Universities.