Cross-border Collaboration Underpins Cross-Border Trade

With all the attention on the negotiations, ratifications and entry into force of the USMCA/CUSMA trade agreement in recent years, it has been easy to overlook another significant catalyst for trade between Canada and the United States that is also a physical manifestation of our powerful trading relationship – the construction of a new international bridge between Windsor, Ontario and Detroit, Michigan. 

 The Gordie Howe International Bridge will be Canada’s largest port on the Canada-U.S. border comprising two secured Ports of Entry, a tolling system, and a connection to the U.S. interstate. The bridge itself, which will be the longest cable-stayed bridge in North America, is noteworthy with an 853 meter (that’s .53 miles!) main span making it one of the largest bridges in the world. It also currently represents one of the most comprehensive and complex infrastructure projects in North America. 

In terms of trade between Canada and the U.S., the bridge represents the first major new trade link in four decades. Orders of magnitude are inherently large with this project. It has a 36-year term, which includes a 6-year construction period, it will create 2500 jobs, and is estimated to have a total project cost of CAD $5.7 billion. 

It is also noteworthy as an example of collaboration, not only between Canada and the United States, but also between the private and public sectors. Recently the Canadian Council for Public-Private Partnerships awarded the Gordie Howe International Bridge Project a 2019 Gold Award for Project Financing. Among its many distinctions, the Council recognized the project as “the first Canadian P3 to use a non-traditional foreign exchange risk framework to balance fluctuating currency prices setting a precedent for future cross-border transactions.”

There’s a tremendous amount of trade that currently travels between Windsor and Detroit which has continued through the COVID-19 pandemic for the future 6-lane (3 U.S.-bound, 3 Canada-bound), 2.5-kilometer (1.5 mile) bridge to support. The Windsor-Detroit corridor is the busiest commercial land border between Canada and the U.S. In 2019, it accounted for 22% of all U.S. trade with Canada and for the first seven months of 2020, this represented $62.73 billion in total trade value. (1)

Upon its completion, the new international bridge will expand travel capacity supporting the economies on both sides of the border. There is certainly a lot to celebrate in this fact alone. But we should also not lose sight of the ‘investment in collaboration’ that both countries are making with this project which itself is a powerful force for continuing to do more business together. 

This project has required collaboration in binational regulations and standards, workforce management, currency management, tax structures, financing, risk management, and sustainability & environmental management. Our ability to work together through these complexities is also part of the DNA in how well we trade together. 

We look forward to having more merchandise trade stimulated by USMCA/CUSMA, crossing north and south between Canada and the United States on a bridge whose tower shape will reflect the curvature of a hockey stick in a slapshot. Clearly, completing this cross-border collaboration will be quite a goal to score together! 

For more information on this project, visit www.gordiehoweinternationalbridge.com.