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Saturday, April 29, 2006

Alberta and BC Join Forces and Become No. 2 Economy

Just found this article in the Vancouver Sun. It's a huge deal, and I can't believe it hasn't been picked up by more of the media. Alberta and BC have officially opened their borders to become the 2nd largest economy in Canada! Here is the article:

Miro Cernetig and Fiona Anderson, Vancouver Sun; with files from Canadian Press
Published: Saturday, April 29, 2006

B.C. and Alberta have announced they will form a new trading bloc to create a regional economy within Canada that will usurp Quebec as the country's No. 2 economy and be second only to Ontario as the country's economic engine.

The agreement, endorsed by B.C. Premier Gordon Campbell and Alberta Premier Ralph Klein in Edmonton Friday, promises to give workers and companies free access to Canada's two westernmost provinces, now in the midst of an oil, commodities and real estate boom.

"We have become the second-largest economy in Canada," Campbell said shortly after signing the deal. "This will be noticed across the country."

The deal, signed after years of negotiations, and in the midst of the bitter lumber war between Canada and the U.S., promises "the most open economies in Canada, if not North America."

It says "investment rules will be the same in each province; businesses only need to register once for both provinces; standards and regulations will be reconciled, transportation will be streamlined and workers certified for an occupation will have their qualifications recognized in both provinces."

It is also, according to the B.C. government, going to translate into economic growth.

In dollar terms, Campbell estimates that after the deal is put in place, by 2009, B.C. will see about $4.8 billion a year in benefits and the creation of 78,000 new jobs. But there's also a long-standing political message: With its booming commodity-based economy, its increasing population and with a prime minister who has his base in the West, there's a power-shift away from the east.

"We're perhaps seeing the building a B.C. and Alberta political axis in Confederation," said Norman Ruff, a political scientist the University of Victoria. "Of course, we'll have to see if it continues after Campbell and Klein [leave power]."

The deal which comes into effect April 1, 2007, and includes a transition period to April, 2009 promises some major changes on the right of workers to cross the provincial border. Reducing inter-provincial trade barriers has been a long-standing goal among provinces, but B.C. and Alberta have come up with specific details that would make it easier to do business between the provinces or even transfer technical skills without having to undergo the complex, time-consuming and expensive business of re-certification.

"Frankly, it's a groundbreaking agreement for both provinces and the country," said Campbell. "It will mean a flow of people and services back and forth across the border without impediment.

"We've talked in Canada about free trade across the country. It's time we actually did something about it."

The new agreement was unanimously applauded as a positive step forward.

"I don't think this is earth-shaking stuff, but you are moving in the right direction when you start removing those barriers," Laura Jones, vice-president of the Canadian Federation of Independent Business for B.C. and the Yukon said in an interview.

"And any time you are talking about regulatory barriers often the progress that you make in a specific area can seem kind of small but the whole overall regulatory burden is so large it is important to make these small steps."

"It can't hurt and it hopefully will be a model for other provinces to follow," Jones added.

Dave Park, chief economist, Vancouver Board of Trade also called the agreement a step in the right direction and hopes it will eventually extend across the country.

"Basically we are able to trade between the U.S. and Canada at this point for the most part better than we can between provinces," Park said. "The freer the trade [and] the fewer the impediments the better it is for the economies on both sides."


The agreement between B.C. and Alberta will create a combined economy that:

n Is the second-largest in Canada, with joint gross domestic product 30 per cent larger than that of


n Could potentially add $4.8 billion to its joint GDP.

n Could lead to 78,000 new jobs in B.C. alone.


Current regulations restrict the movement between B.C. and Alberta of certain occupations that require licensing in each province, such as lawyers and dentists. The provinces have agreed to amend their regulations by April 2009 so 65 professions will be able to move freely between the two provinces. Besides lawyers and dentists, the affected occupations include:





Funeral director


Elevator Constructor

Medical laboratory technologist

Motor vehicle salesperson


Separately, here's how the provinces compare:

B.C. Alberta

Population in 2005 4,254,500 3,256,800

GDP in 2005 $168 billion $216 billion

Number of employees March 2006 1,748,400 1,504,800

Average wage March 2006 $19.71 $20.76

Source: Statistics Canada


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