When Mario Theriault talks about the future, as he often does, he conjures a horn of plenty: an Atlantic Canada where borders between provinces and U.S. states as far south as New York are mere lines on a map; a continental region of such sublime economic coherence that political jealousies and agendas fall daily to the juggernaut of commerce and common sense. Of course, that’s his job. As the founder and C.E.O. of Moncton-based ShiftCentral, a research firm that assembles cutting-edge competitive intelligence for clients in government, industry, and the institutional sector, spinning the delicate threads of possibility into the golden weave of opportunity is just another day at the office. And, frankly, he wouldn’t have it any other way. “We’ve long moved past the point of just fantasizing about the future,” he says. “We now have measurable results that are helping us make all of this real.”
To be precise, “this” is Atlantica – that colourful invocation which, until recently, has been the nearly exclusive property of economic historians, developers and assorted firebrands on both sides of the farthest eastern reaches of the Canadian-U.S. border. “It’s no longer a dream,” Theriault insists. “It’s the past, the present and the future. It exists in tangible, dollars-and-cents ways. Atlantica means prosperity, and lots of it, if we can learn how to nurture it.”
ShiftCentral may well be a case in point. Established six years ago, the company has since become one of the most successful and influential firms of its kind in Canada. Theriault’s moves into Maine and Massachusetts, where he serves clients at both university and municipal government levels, have been instrumental to this growth. Now, with offices and strategic partnerships in Portland, Boston and New York, he is convinced that the future of his company depends, in large part, on the efficacy of his cross-border business relationships. “There really is no disconnect between Atlantic Canada and New England,” he says. “In practical terms, we’re all part of the same economic region.”
He’s far from alone in believing this. Over the past few years, hundreds of Atlantic Canadians have stretched their corporate hands across the border into Maine, New Hampshire, Vermont, Massachusetts and New York seeking, and finding, willing partners to fulfill their international ambitions. Too numerous to list comprehensively, their numbers include both the mighty and the humble in the regional business pantheon: Irving Oil, McCain Foods, Corporate Communications Ltd., Bristol Group, Emira, Aliant, Nanoptix, DeltaWare, Sensor Wireless, to name just a few.
Again, their logic appears unassailable. Atlantica – incorporating the four Atlantic provinces, southeastern Quebec, northeastern New England, and up-state New York – is home to 43 million people, representing $1.43 trillion in gross domestic product (USD). If it were a nation, it would boast the fourth-largest economy in the world, ahead of Germany, and just behind the rest of the United States. That it isn’t, in fact, a nation, but only a sensible expression of commercial pragmatism between two peoples who, on any given day, share more in common with each other than they do with the other far-flung citizens of their respective countries is, paradoxically, an argument for its existence.
Despite official wrangling between Ottawa and Washington over softwood lumber, border security and currency valuations, trade between the Atlantic Provinces and the northeastern United States is growing. According to the latest-available numbers from Statistics Canada, Nova Scotia, New Brunswick, P.E.I., and Newfoundland and Labrador collectively shipped more than $1.84 billion (CDN) worth of finished goods to New England this past February, compared with less than $1.75 billion during the year-earlier month. U.S. northeast imports to this region were comparable in both scale and increase over the same period.
Meanwhile, cross-border alliances between like-minded business organizations have sprung up as counterweights against bi-lateral indifference, or even intransigence, to ‘Atlantican’ aims and objectives. The Bangor-based Eastern Maine Development Corporation (EMDC) and Enterprise Saint John, for example, have been working closely to develop a truly efficient overland trade corridor between their two “sister” cities. Similarly, the Greater Halifax Partnership, again collaborating with the EMDC, has successfully negotiated the first pre-clearance agreement for the Halifax International Airport (a move that will speed the flow of goods and people between these two East Coast ports of call).
In every way, then, Atlantica not only persists; it flourishes. Still, a nagging question remains: How does this brave, even noble, groundswell rise from here? Specifically, what future does it promise for Atlantic businesses in communities inconveniently located off the main thoroughfares of burgeoning north-south trade – places like Bathurst and Miramichi, N.B.; Summerside and Charlottetown, P.E.I.; Port Hawkesbury and Sydney, N.S; and St. John’s and Corner Brook, Newfoundland and Labrador?
Elizabeth Beale, President and C.E.O. of the Atlantic Provinces Economic Economic Council, raises an even more troubling point. “Looking outside the Atlantic Canadian region for long-term economic opportunities and linkages is obviously important,” she says. “But, the fact is we still aren’t doing enough to remove the barriers we already have. Right now, we endure inter-provincial obstacles at enormous and intricate levels. We have barriers against supply management in agriculture, barriers that restrict the hiring of skilled workers across provincial borders thanks to provisions of offshore oil accords. And there are many, many others. Under the circumstances, I’m not sure how much sense there is in talking about Atlantica without factoring in these very real and current issues.”
The point is well taken even by those who fundamentally believe that a rising tide raises all ships. Tim Woodcock may be Atlantica’s leading thinker. He is certainly its most articulate exponent. Born, raised and educated in Maine, he is a former mayor of Bangor, a one-time congressional candidate, a lawyer, and a devoted historian of all things related to the east coast of North America. “You can’t really understand Atlantica without first understanding the past,” he says. “Prior to Canadian Confederation, the eastern seaboard of our continent was a powerful, cohesive economic zone, selling its wares to the U.S., the Caribbean, Britain, Europe, Africa and Asia. Goods and services moved in a straight line, up and down the eastern seaboard for departure to points west and east. It was simply the logic of geography.”
Within this context, he concedes, there are problems with the current model. History and politics have made an over-regulated jungle of what was once a single, seamless trading region. He does not necessarily agree, however, that the mere existence of barriers between states, provinces and nations are reasons enough to stall the overall progress towards renewed regional economic coherence. “Experience is our guidepost in this regard,” he says. “Commerce is going to flow into areas that welcome it, despite the obstacles which may be in the way. Economic boundaries painted on a map, like political ones, really make no sense in the long run. They are like rocks in a river. Commerce is always going to find a way to flow around them.”
A more immediate concern, he believes, is the condition of enabling factors, particularly transportation infrastructure. This, he says, is the issue that demands the most urgent attention on both sides of the international border. “You can’t really talk about Atlantica sensibly without examining the state our respective road, rail, air and sea-going systems – the very infrastructure we rely on to move goods and services from producer to consumer. These are the hard lines around the whole Atlantica concept.
“The North America Free Trade Agreement created new facts for the northeast to come to grips with. The emerging economy is even more transportation-sensitive than the old one, largely because it’s being run on ‘just-in-time’ factors. We’ve moved from a ‘push’ economy to a ‘pull’ economy. Automakers represent the classic push economy. In other words, you manufacture a car and throw it out into the marketplace and hope someone buys it. Increasingly, though, commerce is being driven by consumers getting online and custom ordering a product. And when they do, they want what they order not next month or even next week, but right now. You’d better be able to deliver. The question is, given the state of our multi-modal capabilities, can we come through?”
Not entirely. At least, not yet. But there is no doubt that the issue has climbed to the top of the agenda and is perceived, by almost everyone who thinks about these things, as the key to unlocking Atlantica’s potential, not only for businesses and communities located along the main transportation corridors, but for those situated somewhat off the beaten track. In fact, to Brian Crowley, president of the Halifax-based Atlantic Institute for Market Studies, regional infrastructure cuts to the heart of the area’s global competitiveness and, therefore, very survival. “If we were just talking about increasing trade and improving commercial relationships within Atlantica, I don’t know if there would be much to discuss,” he says. “The opportunity we now face is much bigger than internal efficiencies It’s international. The Far East is beckoning, so we’d better get on the ball.”
Indeed, China has recently overtaken Britain and France to become the world’s fourth-largest economy. With a GDP of $1.5 trillion (USD), the so-called ‘Secret Kingdom’ now trails only Germany, Japan and the United States in economic might. Still, this extraordinary expansion – unprecedented among any nation at any time in history – has come at a predictable cost: domestic economic imbalance. A United Nations Human Development report, issued earlier this year, concluded that the urban-rural income inequality gap in the country was the highest in the world. And that’s bad news for the country’s ruling class, which understands that the implications of this trend are escalating social unrest, poverty, disease, and famine in the outlying regions – any one of which would derail, or at least curtail, long-term economic prospects.
Not surprisingly, then, Chinese officials have begun to embrace the notion of “balanced growth”, which involves moving more of the capital and resources currently trapped in the cities into the countryside. Something short of a nationwide rebuilding effort, it is, nonetheless, a pragmatic attempt to avert a potentially disastrous currency collapse down the road. But to succeed, the country will need more of what it cannot yet produce for itself, and in volumes sufficient to achieve its goals: value-added construction products; manufactured and re-manufactured goods; resource-based raw materials; and, perhaps most importantly, expertise.
Enter Atlantica. “Think about the trade relationship between North America and Asia,” Crowley says. “Right now, consumers are pulling goods out of China. At the moment, though, there’s not a lot of stuff actually going back from North America. So, on the back-haul, there are a lot of empty containers to which we would have access at zero cost when demand for our goods and services in China begins to rise.”
When it does, currently underutilized ports – such as Halifax, with its deep-water harbour, sophisticated terminals, and inter-modal connections – will benefit. In fact, the Port of Halifax is already positioned as key hub along the China-Europe-Atlantica sea corridor. Its most tantalizing opportunities are now linked to Asian trade through the Suez Canal. But these could expand exponentially if, and when, the proposed rebuild of the Panama Canal takes place over the next years. “That’s the bright future for this region,” Crowley says. “But, to make it work, we need to invest in our ports and all the other connections we have. If we don’t do this, then we will not only fail to grow, we will actually fall behind. We will lose business. The biggest concern I have is that there may be some people out there in the region who cling to the belief that we can hold on to the status quo. In the global trading environment, the status quo actually represents a loss.”
If this is, indeed, what’s ultimately at stake for Atlantica, it has not escaped the attention of dozens of men and women on both sides of the international border who are now working together to ensure the region’s long-term competitiveness, one barrier-busting effort at a time. Consider, for example, the comprehensive joint venture between Enterprise Saint John and the Eastern Maine Development Corporation to fashion a true gateway for both trade and extensive bi-national economic development and cooperation. “We have signed a Memorandum of Understanding with the EMDC that essentially makes us partners,” says Steve Carson, C.E.O. of Enterprise Saint John. “We share office space, and we collaborate extensively on issues of mutual concern. Up until a couple of years ago, that cohesion just wasn’t there. We aren’t partners in name only. We’re a dynamic team of people who share bonds of history and economic interest.”
Jonathan Daniels, EMDC’s president and C.E.O. couldn’t agree more heartily. “In the past, Bangor would compete for business in Atlantic Canada,” he says. “That was clearly a zero-sum game. Now we are looking at industrial partnerships. In the process, we are working to strengthen business partnerships on both sides of the border. We are spreading the message, and capitalizing on existing relationships in Atlantic Canada to move the culture away from the industrial raiding model to the business-to-business matchup model.”
The approach is already paying dividends. EMDC and Enterprise Saint John were instrumental in negotiating significant upgrades and improvements to the border crossing at Calais/St. Stephen. Last year’s U.S. Federal Highway Transportation Reauthorization Bill provided approximately $7 million (USD) to the effort, and another $50 million for a brand new, state-of-the-art facility. Even more importantly, perhaps, the U.S. Congress also approved a ‘Highway Priority Corridor’ designation for a route from Calais to Watertown, New York, a first for the entire northeastern United States. This designation represented a tangible and significant step towards establishing a trade corridor extending from Saint John and Bangor to New Hampshire, Vermont, New York, Quebec and Ontario. Among other things, the designation will provide the proposed International Northeast East-West Corridor with priority access to future U.S. federal planning, transportation and infrastructure funding. “This is a huge advance,” Carson says. “It’s an example of connectivity in action. And it wouldn’t have happened without Canadians working with Americans to break down one, very real barrier to regional coherence.”
According to Derek Oland, Chairman of Saint John-based Moosehead Breweries, it’s about time. “To say that this is a positive development is to understate the case, I think,” he says. “It’s more important now that at any other time for companies to have easy access to both Canadian and U.S. marketplaces. This sort of infrastructure improvement is precisely the kind of thing that facilitates business growth and cross-border partnerships. It’s the kind of thing that translates the ideals of Atlantica into cold, hard facts.”
Stephen Dempsey, Chairman of the Greater Halifax Partnership, thinks the number and effectiveness of initiatives such as this will only rise in the years ahead. “When people ask me what we are doing to build the Atlantica region, I talk about the fact that we’re working to ensure that our border with the United States is the best that it can be for business and trade,” he says. “Inevitably, people will object and claim that Nova Scotia doesn’t have a border with the U.S. That’s when I say, ‘yes we do; it just happens to be in New Brunswick’.”
Dempsey recently worked hand-in-glove with the EMDC to score another victory against the forces of institutional border control. “We partnered with them to persuade Washington to provide the Halifax International Airport with pre-clearance rights. Now, that would never have happened without serious collaboration on both sides, at the local level.”
All of which suggests that the “logic of geography” is slowly, surely exerting its inevitable influence in the Atlantica region. Hastened by shifting global patterns of trade, emerging economic dynamos like China, and the historical ties that inexorably bind the Atlantic provinces to New England, the shape of things to come is getting easier to perceive. Change will not come swiftly, but it will come, and when it does it will not merely affect communities and businesses along the main trunks of trade and commerce, but everyone, regardless of where they live and work in the region.
Says Crowley: “It’s a multiplier effect. If we can increase traffic within the region, the cost of doing business here will drop. As it drops, we attract more investment, hence more traffic, hence more and greater commercial opportunities. And these will spread to all parts of the region. And that’s what economic coherence is all about.”
Mario Theriault certainly doesn’t doubt it. “As far as I’m concerned, Atlantica is already here, and I am a part of it.”