A recent report by the University at Buffalo (SUNY) entitled "The Economic Impacts of U.S. Government
Antiterrorism Policies and Regulations on Cross-Border Commerce between Southern Ontario and Western New York," examines the impact of post-9/11 security regulations on the bilateral trade performances of companies
on both sides of the border. The Canada-U.S. Trade Center at the University at Buffalo, which is well respected, conducted the research and wrote the report. It is an excellent report and should be useful for those
working on the border agenda. The report is available on the IE Canada web site.
The Report gives concrete evidence/results that
Canadian firms have been more heavily affected by the new security regulations in several categories, including negative export effects, increased import prices, additional compliance costs and trade disruption. The
report says that a typical Canadian exporter to the U.S. spends 2.7 per cent of its total revenues (31 per cent increase since 2001) on security. Overall, the total cost to Canadian exporters as a whole is
estimated at $6 billion per annum. Compared to the U.S., Canadian firms appear to have suffered disproportionately in terms of reduced profits, lower productivity, increased insurance and inventory costs, traffic
diversions, and just-in-time inventory (JIT) disruption. And SMEs are the most heavily affected.
The report also documents a number of responses that Canadian and U.S. firms might consider. These pertain to
supply-chain re-configuration, relocating production or warehousing facilities, and/or shifts in transportation modes (e.g. trucks to air).
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