A Greater North America Transportation & Trade Initiative

EXECUTIVE SUMMARY

INTRODUCTION

The last fifteen years have seen a major breakthrough in the way trade is conducted in the Western
Hemisphere. The negotiation and approval of the North American Free Trade Agreement (NAFTA) in the nineties brought together the economies of the United States, Mexico and Canada, establishing the framework for the United States and its neighbors to move toward an integrated economic bloc.

In assessing the trade opportunities of the region, a sector that has shown major limitations and problems is transportation. The challenges faced by this sector are related among others to poor and inadequate infrastructure; lack of resources to modernize existing infrastructure and make new investments; lack of trained manpower; not enough application of technologies; and bottlenecks in the rules, regulations, and procedures for the implementation of trade. These challenges were discussed at the U.S.-Mexico Chamber of Commerce (USMCOC) Acapulco conference on September 8-10, 2005.

The USMCOC was one of the leading organizations behind the NAFTA effort and has been involved in several initiatives of a bi-national nature designed to promote and enhance trade. Over the years, beginning in 1998, the Chamber published Transportation studies that highlighted challenges that the sector was facing. These challenges were updated during the Acapulco conference and included among others: strengthening cross-border trucking operations; more compatible systems of transportation; liability issues; education initiatives; cross-border transportation process; harmonization and standardization procedures; joint cooperation between the public and private sector; and application of technologies.

At the Acapulco conference ninety-one professionals and experts, from the United States and Mexico participated, giving it a truly bi-national flavor. The group discussed challenges in the area of land, sea and air transportation and engaged in provocative and productive discussions that ended in consensus. The results of the conference are the foundation for the Chamber's new Transporte Internacional Initiative (TII).

APPROACH

The Acapulco conference provided the opportunity to discuss problems and opportunities in the various components of the transportation system and to review in-depth obstacles and problems that limit a fluid trade process hinders competitiveness, and pose a threat to the future trade relationship between the United States and Mexico.

Some of the problem areas that were discussed included:

The imbalance that exists in the Northbound and Southbound trade;
Border-crossing issues such as duplication of efforts, lack of automation, and a need for a "one-stop shopping window;"
Facilitating connection to different routes at border-crossings;
The critical shortage of drivers in the United States which will make the service more costly or unable to operate efficiently in areas that are perceived as "problematic;"
The implementation of security initiatives as a result of 9/11;
Liability issues in cross-country transportation; and
Inadequate communication among government agencies.

It was agreed that a coordinated institutional bi-national approach is needed to provide a "sense of urgency" to address the problems. In Acapulco the USMCOC received clear direction to organize an initiative designed to address existing problems in an institutionalized manner, integrating public officials and business representatives from both countries, with experience in all modes of transportation and cognizant of the challenges at hand. This mandate was reconfirmed during the Chamber's Bi-national meeting in Mexico, D.F. in December 2005.

In addressing the challenges, the Chamber was asked to take into consideration not only the present but also just as importantly, the implications for the future. It was also agreed that as long as the issues were being addressed, attention should also be paid South of the Border of Mexico, anticipating a closer relationship with Central America as a result of Plan Puebla-Panama, and the importance that the Panama Canal has for hemispheric trade and transportation realities of the region. Therefore, USMCOC is addressing the initiative as "Greater North America" (Canada to Panama).

SCOPE

The elements of the initiative are:

Focused on the transportation problems of today and its implications for the future;
Bi-national in nature with a focus on the region from Canada to Panama;
Include land, air and sea transportation;
Service providers to include logistics, should be part of the initiative;
Include high level government officials of both countries, that have a direct impact on the transportation process;
Set a definite timeframe, in this case, two years;
Have clearly stated benchmarks and measurement standards; and
Acquire adequate funding to be able to perform a credible job.
The USMCOC is uniquely qualified to undertake such a responsibility. Besides its bi-national nature, it has been involved in the transportation sector and in trade issues throughout its existence. In addition, because of its extensive infrastructure of regional offices, its members include representatives from the different modes of transportation that will provide exceptional expertise in all areas. Last, but not least, the excellent relations between USMCOC's leaders and government officials from both countries, allows for the establishment of good communication to discuss issues in an honest and open manner.

ADMINISTRATION

The administrative structure will fall under the USMCOC umbrella and be directed out of the Chamber's Washington office. The initiative will have an Executive Coordinating Committee and five Working Committees addressing specific sectors. They are:

Executive Committee
Al Zapanta, President of USMCOC, who will serve as Chair of the Committee; Amb. Cresencio Arcos, Director of International Affairs for Homeland Security; Sam Banks, former Acting Director of U.S. Customs; Federico Sacasa, President of Caribbean/Latin America Action; José García Torres, former Director of Nafin S.A. in Washington; and Amb. Juan B. Sosa, President of Greater America Business Coalition, who will serve as the Executive Director of the initiative.
Working Committees
Infrastructure / Security & Safety / Inter-modal Transportation / Technology / Logistics