How a $100B transit investment could lower cost of goods in Canada’s North

Four litre jugs of milk for sale in the North Mart in Iqaluit, the capital of Nunavut, Canada on February 15, 2014. Expensive groceries contribute to a high cost of living in the north. THE CANADIAN PRESS IMAGES/Don Denton

OTTAWA – A group of academic researchers say a dedicated, cross-Canada corridor for roads, rail, pipelines and communications lines could cost $100 billion to build.

The researchers from the University of Calgary’s school of public policy say creating the corridor to transport goods and people would eliminate the need for multiple reviews of pipeline and transportation projects, allowing governments to review and consult with aboriginal groups on the correct path for a right-of-way where projects could then be built.

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To make it happen, governments would have to spend money to lay the groundwork for private investment, but just how much the federal and provincial governments would have to put in is something the researchers say needs further study before shovels go in the ground.

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“We don’t expect the $100 billion to be put up by governments,” said report author Andrei Sulzenko.

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“This is ideal for private sector, long-term private sector investment, just like they do all over the world and I know … people are sitting on piles of cash looking for good projects.”

The proposed 7,000-kilometre northern corridor, the idea of which has been batted around for years, would run from Labrador, through northern Quebec and Ontario, then west through the boreal forest and up to the country’s northernmost communities.

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The corridor would make it easier and cheaper to move goods in and out of the North and likely bring down the high cost for food and utilities in northern communities large and small, the report argues.

And it would also allow resource extraction companies, such as mining companies operating in Ontario’s Ring of Fire, to ship their products east-west to reach emerging trading partners like China rather than through traditional north-south routes designed for trade with the United States.

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“There are just so many potential benefits that we think it’s incumbent on the Canadian public to start this discussion right away and make sure that we don’t sit idly by and sort of wait for the future to pass us by,” said researcher G. Kent Fellows.

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Infrastructure Minister Amarjeet Sohi told a Senate committee on May 4 that he has had talks with “various stakeholders and proponents” along the corridor.

He said work on the idea was not “coming together in a co-ordinated way yet.”

“If we want to facilitate resource development, we need to have more of a co-ordinated approach, and also interest from the private sector, so that we know what level they are at in their investments. That is where we are. It’s very high level at this time,” Sohi told the transport committee.

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