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Commentary

Why Canada Matters

America’s neighbor to the North is good for the economy, good for Texas

Rachel McCormick

By Rachel McCormick
Guest Columnist

For over 150 years, Canada has been more than just a great neighbor – we are your best customer, closest security partner, and largest supplier of energy. Texas is an important part of all these mutual benefits.

Texans may think of other countries first when they consider international trade and cooperation. We understand that, but we think we should go against type and brag a bit about Canada’s contributions to the Texas economy.

Canada is often thought of in terms such as friendly, polite, and snowy. We own them all, but we also have a compelling economic and trade story to tell in Texas – we are Texas’ second-largest export market after Mexico. Texas exported $27.8 billion in goods and services to Canada in 2020, and nearly 700 Canadian-owned companies operate right here in Texas. These companies account for almost 57,000 jobs throughout the state.

Beyond our common North American geography, we share values and interests, and multi-layered economic ties. Here are the adjectives I would use to describe our bilateral relationship and why Canada matters:

Prosperous. Canada and the United States share the largest trade relationship in the world.  Our trade is balanced, fair, and supports growth and innovation in both our countries. Every day nearly US$2billion worth of goods and services cross the Canada-U.S. border. This prosperous economic partnership supports good paying jobs in both countries. More than 5,500 Canadian-owned businesses in the U.S. support nearly 900,000 jobs. We buy more goods from the U.S. than China, Japan, and the U.K. combined. 

Integrated. Canada and the United States not only sell to each other, we make things together. Since the beginning of the pandemic, our countries have worked hard to maintain the two-way flow of goods, particularly medical supplies and critical inputs across our borders, while protecting our communities from COVID-19. On average, over 25% of a finished product we sell to you is American content. Just like most imports from Canada are used in production that puts Americans to work. These long-standing, binational supply chains have not only kept us safe, they have kept us competitive globally.

Reliable. Energy from Canada – more than from any other country – contributes directly to U.S. economic prosperity, security, and environmental objectives. We are your largest and most secure supplier of all forms of energy, carried by 71 oil and gas pipelines and 35 transmission lines across our shared border. We are also investing in new technologies and infrastructure to be a global leader in clean energy and innovation. Canada is developing our energy resources in a way that creates prosperity and engages communities, while reducing emissions and preserving the environment.

Steadfast. Canada has fought alongside the U.S. in defense of our common values through World Wars I and II, the Cold War, Korea, Balkans, the Middle East, and Afghanistan. In fact, Canadian Army, Navy, and Air Force officers are embedded throughout the U.S. military, and at the bi-national North American Aerospace Defense Command (NORAD) at all levels – protecting and defending our shared continent in search and rescue operations, interdiction of illegal narcotics, interception of non-allied military aircraft, and humanitarian assistance and disaster relief missions.

Canadian tourists contribute millions to the Texas economy every year. Canadian snowbirds, who feel welcomed when their Texas neighbors call them “Winter Texans,” contribute substantially through real estate investments, business sales, and tax revenue.

On July 1 we celebrated the first anniversary under the United States-Mexico-Canada Agreement (USMCA), under which Texas businesses have continued access to duty free supply chains from Canada. Previously known as the North American Free Trade Agreement (NAFTA), the updated agreement preserves key elements of NAFTA, modernizes provisions to address 21st century trade challenges, reduces red tape at the border, and provides enhanced predictability and stability for workers and Texas businesses.

Being over 1,000 miles away from the tip of the Texas Panhandle can make it easy to forget America’s Northern Neighbor, but our shared values and interests, and deep connections, coupled with the powerful, multi-layered economic ties are definitely reasons why Canada should remain front of mind as we move forward together towards economic recovery.

Rachel McCormick is the Consul General of Canada to the states of Arkansas, Louisiana, New Mexico, Oklahoma and Texas. She was head of the Energy and Environment Section at the Canadian Embassy in Washington, DC from 2014 to 2019.

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