The Importance of Canada-U.S. Cross-border Mobility: What If the Next Barriers Weren’t Tariffs?

Although current discussions focus largely on the threat of tariffs, it’s crucial not to underestimate the potential impact of non-tariff barriers that could restrict cross-border mobility between Canada and the United States.

In addition to the export of goods, trade in services between Canada and the U.S. has reached considerable levels and plays a vital role in our economy. In 2023, Canada exported some C$120 billion in services to the U.S., and imported around C$100 billion in services from the U.S. These exchanges require fluid cross-border mobility, flexible measures and rapid market access. Strict and complex administrative requirements and restrictions on services could seriously disrupt these economic exchanges and impact the competitiveness of Canadian businesses. 

Current Context

The free trade agreement between Canada and the U.S., known as the Canada–United States–Mexico Agreement (CUSMA), plays a key role in the mobility of professionals and business travellers between the two countries. Its future remains uncertain, not least because of the protectionist measures planned by the Trump administration, which has announced its intention to renegotiate or withdraw from certain trade agreements in order to protect U.S. industries.  

Any restrictive change to this agreement would have an immediate and drastic effect on the mobility of businesspeople, investors and professionals between the two countries. The impact is likely to be greater for Canada, which exports more services than it imports. This disparity can also be explained by the fact that Canada’s immigration system offers more options for the admission of various professionals to Canada than does the U.S. system, which is more restrictive and includes a number of obstacles. 

The CUSMA plays a key role in the admission of professionals wishing to offer temporary services in the United States. In the past year, Canada and Mexico have benefited from the admission of over 50,000 applicants classified as “professionals.” Without this agreement, the professionals in question probably wouldn’t have had access to the American market other than through H-1B visas, which are a costly and uncertain option due to the lottery system that governs their allocation. 

Canadians also make extensive use of the CUSMA to facilitate the admission of businesspeople and their essential personnel who make significant investments in the United States, notably through the creation or acquisition of American companies. In 2023, applications for investor visas by Canadian citizens reached record highs, with over 6,000 Canadians benefiting from this program. Canada is the largest user of this type of visa in the Americas. 

The CUSMA also facilitates the admission of certain executives and highly specialized employees transferring within the same corporate group, by offering the possibility of submitting work permit applications directly at the port of entry. This is an important benefit reserved for Canadian citizens under this agreement.

Conclusion 

Even without an in-depth analysis of all aspects of the CUSMA that bring considerable benefits to all three parties involved, it’s clear that this agreement is essential for Canadian businesses. In an integrated economy and a competitive world where trade in services plays a significant role, this agreement is essential to enable companies to rapidly deploy experts where they’re needed. Cross-border mobility is essential to promoting bilateral trade and stimulating economic growth and innovation.  

At BCF, our mission is to support Québec companies by helping them meet their challenges and reassuring them in times of uncertainty. We use our skills and know-how to help our clients navigate complex situations like cross-border mobility. Our team will be happy to guide you. Contact us today!