Bush to Tackle Border Delays, Security in Canada-Mexico Talks

By Theophilos Argitis and Mark Drajem

Aug. 20 (Bloomberg) -- President George W. Bush travels today to Quebec for talks with Canadian and Mexican leaders that will be dominated by two increasingly conflicting goals: tightening border security and speeding commercial traffic between the trading partners.

In two days of meetings in Montebello with Canadian Prime Minister Stephen Harper and Mexican President Felipe Calderon, Bush will discuss ways to reduce waiting times for trucks at the borders with new technology and coordinated inspection hours, David Bohigian, an assistant secretary of commerce, said. The leaders will also discuss cooperation on protecting intellectual property and expanding airline services, as well as issues such as Afghanistan and the Middle East.

``We have to wring out the inefficiencies at the border,'' Bohigian said in an Aug. 16 interview. Doing so would allow businesses in the region to compete better against Chinese and other Asian rivals, he said.

All three North American leaders head parties lacking legislative majorities, constraining their agendas to administrative matters such as easing regulatory hurdles and coordinating responses to emergencies.

``They are going to set their sights pretty low,'' said James Jones, a former U.S. ambassador to Mexico who's now the co-chairman and chief executive of Manatt Jones Global Strategies, a Washington firm that advises companies seeking to expand into Latin America.

The talks come amid a swelling protectionist tide in the Democratic-controlled Congress that has delayed consideration of four new free-trade agreements. Lawmakers also allowed Bush's authority to negotiate trade pacts that Congress can't amend to expire at the end of June without prospect of renewal.

Nafta Criticism

The leading Democratic presidential contenders, meanwhile, have taken aim at the North American Free Trade Agreement, which last year helped generate about $880 billion of trade among the three countries.

Illinois Senator Barack Obama and former North Carolina Senator John Edwards pledged during an Aug. 8 candidates' debate to revise the 13-year-old accord if elected. Democratic frontrunner Hillary Clinton, the New York senator whose husband, Bill Clinton, pushed Nafta through Congress when he was president, said the U.S. is hurt by the way the pact has been implemented.

Bush, who will meet Harper and Calderon individually before the three-way discussions begin, needs to tend to major irritants with each country. Canada has been at odds with the U.S. in recent years over caps on exports of softwood lumber and new Department of Homeland Security passport requirements for cross-border travelers.

Rift Over Passports

Harper will raise the passport issue at the summit, a government official, speaking on condition of anonymity, told reporters at a pre-summit briefing Aug. 16 in Ottawa. The U.S. Congress last year moved to delay the start of the requirement by 17 months to June 1, 2009.

A 2005 study by the Canadian Tourism Commission estimated that the passport rules could reduce the number of American visits to Canada by 7.7 million, or 5.2 percent, and cost the Canadian tourism industry C$1.7 billion ($942 million) by 2008, when the new requirements originally were due to start.

U.S. Representative Louise Slaughter, a New York Democrat whose district includes border crossings at Niagara Falls, wants the leaders to address the ``confusion'' over the planned passport requirement.

``We're seeing increasing delays at our northern border,'' John Santore, her spokesman, said.

Mexican Trucks

Moving to defuse another dispute before the summit, the Bush administration on Aug. 17 announced it will continue with plans to give Mexican trucks access to U.S. roads as required by Nafta. The U.S. House of Representatives, reflecting opposition from highway-safety and labor groups, voted in July to postpone the change. The Senate hasn't acted on the measure. Canadian trucks have full access to U.S. roads.

Drug-trafficking and immigration also dominate U.S.-Mexican relations. This month the Bush administration announced a crackdown on U.S. employers who hire illegal immigrants, a move that the government says should cut down on migrants crossing the Mexican border into the U.S.

The three leaders will hear tomorrow from a panel of business executives on how to increase the region's competitiveness. The group, which includes executives of Wal- Mart Stores Inc., Ford Motor Co., Chevron Corp. and United Parcel Service Inc., has recommended allowing customs screening of products at factories to avoid border delays, new procedures on regulations, and steps to stop counterfeiting and piracy.

Competitive Threats

Supporters of such moves say the three leaders must do more to meet the competitive threat from China, which last year overtook Mexico as the second-biggest U.S. trading partner behind Canada.

``The European Union has grasped the essential of breaking down borders, and that's a lesson we haven't learned,'' said David Snyder, chief counsel of the American Insurance Association in Washington.

Bohigian, the assistant secretary of commerce, said the U.S. isn't looking for EU-style integration.

``We're not giving up our sovereignty,'' he said.

The Council of Canadians, an Ottawa-based advocacy group, says Canada already is losing its ability to set independent policies on issues such as the environment and immigration. The group plans protests at the Montebello event.

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