Keystone XL and cross-border ties

Canada-U.S. relations are important to both nations. The bilateral relationship the two countries share is one of the most extensive and encompassing in the world. The volume of bilateral trade between the two is astronomical, approximately $1.6 to 1.9 billion every day in goods travel between the two borders. In addition to this staggering number, Canada and the U.S. are staunch international allies as well.

By the time the 1990s rolled around with the Chrétien and Clinton era, NAFTA became reality, and the largest free-trade area in the world was implemented. Canada at the time was a G-7 nation but lacked a secure market with a country of relatively large population. Canada had no choice but to take on a continental economic partnership, or risk losing its ties with the world’s strongest economies.

Fast forward to the present and examine where the two nations stand. Both are seeing recovery from the economic crisis of 2008 and slowly building the economy back up on both sides of the border. However, some friction exists between the two countries. No doubt, one of the most contentious issues right now in terms of Canada-U.S.relations is the Keystone XL pipeline. While President Obama has been a champion of the environment throughout the Keystone debate, the latest string of rail accidents related to transporting oil is strengthening the chance that Obama will approve of the pipeline.

Canada isn’t waiting for the Americans to make the moves anymore. Last month, Canada’s National Energy Board approved the Gateway Pipeline, an alternative to Keystone. The difference is the new pipeline will go from Alberta to the Pacific Ocean with the intent of exporting Canada’s most profitable natural resource to Asian markets. Ideally, the Keystone XL would be the best way as it would keep Canadian crude oil strictly to the U.S, providing North American energy independence.

With an upcoming mid-term election in the U.S. with heavy implications for both parties, do not be surprised if Obama goes against his pro-environment rhetoric in approving the pipeline. Alaska, Louisiana, Montana are all big energy producers who happen to have Democrats in traditionally Republican states represented in the Senate.

Through the issue of Keystone, we have just another example of Canada-U.S relations and the impact that it has on our daily lives. It is worth keeping an eye out on the development of this project, as the implications for both nations could be staggering.



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