Washington should look next door for trade, not just overseas

WASHINGTON state, like every other jurisdiction in North America, is fixated on increasing export and investment opportunities overseas. In the rush to build stronger business relationships with foreign trade partners, we should not overlook our most important and historically most reliable neighbor — Canada.

In 2009, Canada was Washington's second-largest export market (after China). Canada was the largest market for Washington's non-aerospace exports (about $5.9 billion in total sales), more than three times that of China. The largest share of the clean-technology exports went to Canada, almost seven times that of China. An estimated 174,000 jobs in the state were attributed to trade between the two countries.

International visitor travel to Washington is dominated by Canada. Canadians made up 95 percent of international trips, with 94 percent of these originating in British Columbia and contributing more than $416 million to the state's businesses.

Focusing on Canada offers unique advantages. Geographical proximity makes Washington a natural destination for Canadian tourists and reduces cross-border transportation costs for shippers of goods. Similar legal systems and economic cultures make it much less difficult to do business in Canada than in emerging economies.

Scientists, researchers and industry leaders have well-established cross-border networks in place in vital job-creation areas such as clean-energy technology, marine sciences and biotechnology. B.C. and Alberta have tight labor markets that offer opportunities for increased cross-border employment.

Washington is especially well-positioned to realize benefits from greater interaction and partnerships with Canada. Building on the momentum of the 2010 Olympics, Gov. Chris Gregoire and B.C. Premier Gordon Campbell recently signed a joint regional marketing plan to attract investment and create jobs.

Canada has launched a major Asia Pacific Gateway initiative and B.C. and other provinces are investing billions (and attracting private investment of about the same amount) for an ambitious series of infrastructure projects focused on ports, rail and roads intended to create a multimodal network to move people and goods across the Pacific and throughout North America more efficiently. Its maritime entry points are Vancouver and the new container port facility in Prince Rupert.

Although the Gateway initiative is in competition with Washington state and other West Coast ports in the U.S., there are prime opportunities for cooperation because of how this massive project will connect to integration, border problems, supply chains and transportation systems within the Pacific Northwest and elsewhere in North America. So far, there has been little discussion of the spillovers from the project on this side of the border.

So what should be done?

• First, the state's Department of Commerce needs to pay at least as much attention to Canada as it does to Vietnam. The agency has no foreign-trade representatives assigned to Canada.

• Second, there should be a well-institutionalized Washington-British Columbia cross-border forum.

To their credit, Gregoire and Campbell have established regular annual joint Cabinet meetings since 2005. But what happens when these two cross-border "champions" depart from the scene? Campbell announced earlier this month that he was stepping down as premier.

• Third, why not create a Washington-B.C. University Institute to link the region's universities and think tanks? The institute, perhaps modeled after the European University Institute, and funded by companies with a strong interest in strengthened business and cultural ties, would bring together the best students and researchers on both sides of the border to support innovation, address regional issues and consider how the region as a whole can confront global challenges.

This pooling of intellectual resources in both countries is all the more important as the state budget worsens and the mood of Americans becomes even more inward looking.

Washington's connections with Canada and the rest of the world have been essential to the state's economy and culture. It is important that those connections continue to be revitalized with new ideas and strategies that fit emerging realities in our region and the world.