According to a report from the Montreal Economic Institute (MEI), Quebec imposes the most barriers to interprovincial trade among Canadian provinces. The MEI highlights that these protectionist measures have adverse effects on the Quebec economy.
MEI public policy analyst, Gabriel Giguere, emphasized that while barriers to internal trade might not be widely publicized, they significantly impact Canada’s economy. The elimination of these barriers, he argued, could enhance productivity and contribute to an improved standard of living for Canadians.
A 2017 study by Statistics Canada revealed that trade barriers between provinces contribute to a 7% increase in the prices of goods and services. Recent studies cited by Giguere suggest that the long-term annual gross domestic product (GDP) could increase by $110 billion to $200 billion if these barriers were removed.
The MEI report identifies 35 Quebec exceptions to the Canadian Free Trade Agreement, a number that has remained unchanged since 2017. Giguere points out broad barriers, such as those affecting the forestry sector, where all wood from provincial forests must be entirely manufactured in Quebec. He also highlights the limitations on purchasing alcohol from suppliers in other provinces, even though it has been possible to bring alcohol from other provinces since 2022.
In terms of labor mobility, Quebec is considered average, with four exceptions to the Canadian Free Trade Agreement related to labor mobility. Giguere questions the relevance of restrictions on the mobility of professionals between provinces, citing the example of dentists facing barriers to practicing in Quebec.
Giguere emphasizes that in a context of labor shortages, these constraints do not benefit Quebec, as barriers act as obstacles to entry rather than exit. This means that while Quebec workers can seek opportunities elsewhere, the province is restricted from accessing a broader pool of workers.
Conclusion: The report sheds light on Quebec’s position as the province with the highest barriers to interprovincial trade, underscoring the economic impact and the potential for substantial gains if these barriers were dismantled. The MEI’s findings call for a reconsideration of trade policies within Quebec to promote economic growth, efficiency, and improved living standards for its residents.
FAQ: Q: How many exceptions does Quebec have to the Canadian Free Trade Agreement? A: According to the MEI report, Quebec has 35 exceptions to the Canadian Free Trade Agreement, a number that has remained unchanged since 2017.
Q: What sectors face notable barriers according to the report? A: The report highlights broad barriers, such as those affecting the forestry sector, where all wood from provincial forests must be entirely manufactured in Quebec. Additionally, restrictions on purchasing alcohol from suppliers in other provinces are noted.
Q: How does labor mobility in Quebec compare to other provinces? A: Quebec is considered average in terms of labor mobility, with four exceptions to the Canadian Free Trade Agreement related to labor mobility. The report questions the relevance of restrictions on the mobility of professionals between provinces, citing examples like dentists facing barriers to practicing in Quebec.
Q: What is the potential economic impact of removing interprovincial trade barriers? A: Studies cited in the report suggest that the long-term annual gross domestic product (GDP) could increase by $110 billion to $200 billion if interprovincial trade barriers in Quebec were abolished.
