OTTAWA--Canada declared as a national priority a proposed expansion at the country's busiest port in Vancouver, British Columbia, arguing that it is required for the country to meet its goal of doubling non-U.S. exports by 2035.
The designation also kicks off an accelerated regulatory review process, whereby officials are tasked with determining how the expansion proceeds and under what conditions, as opposed to whether it requires approval.
Officials said this puts the timing for a final investment decision from the Vancouver Fraser Port Authority by mid-2027.
"We cannot afford to let bottlenecks hold back Canadian trade," Canadian Transport Minister Steven MacKinnon said Friday at a press conference in suburban Vancouver. "The sooner we build the [trade] capacity Canada needs, the sooner Canadian businesses and workers can benefit."
The authority, which manages the Vancouver port, said the expansion project would increase container capacity by about 50%, through a new land-mass and wharf structure covering 300 acres. This additional capacity could support annual trade of 100 billion Canadian dollars (US$71.5 billion).
Officials peg the project's cost at C$5.9 billion. Canadian Prime Minister Mark Carney has pledged up to C$10 billion in financial support for Pacific coast trade corridors.
The port authority said the Vancouver terminal currently handles more than C$1 billion in commerce daily, and more cargo than the next five largest Canadian ports combined.
The expansion, upgrade and construction of trade corridors across Canada is a priority initiative for Carney, who has argued that it is necessary to restore resilience in the economy and reduce the country's reliance on U.S. trade to drive economic growth.
According to government documents, there needs to be a "significant expansion" of Canada's port capacity to diversify trade, adding that 80% of trade with non-U.S. markets is done by sea. The prime minister has set a goal of doubling the level of non-U.S. exports by 2035.
"Continued inaction on port expansion could eventually force Canadian importers and exporters to utilize U.S. ports--a dependency that is untenable in the current geopolitical circumstances," officials said, according to documents distributed at a technical briefing. "Port expansion is thus integral to ensuring Canadian sovereignty and control over key economic linkages to the rest of the world," the officials said, according to the documents.
Officials warned that without port expansion, Canada could face sharply higher shipping costs of up to C$900 million a year due to traffic congestion and insufficient capacity.
Bank of Canada researchers warned this year that the country lacked the port capacity to executive the government's trade agenda.
The central bank's analysis indicated Canadian ports can't accommodate some of the latest ultra-large container ships being deployed. Because of this, some goods originating from China and destined for Canada and loaded onto these big vessels have to dock in Los Angeles--and those goods could be subject to U.S. tariffs.
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