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Some might object that SEZs, so far as they created a competitive advantage for businesses locating there, could damage existing businesses located just outside the zone. But SEZs established in economically stagnant areas with limited business activity should not be unduly disruptive. Also, following the American FTZ model, existing businesses within a certain radius of a zone could apply for SEZ status without physically relocating.

Nevertheless, SEZs would be tricky to enact politically. The policy would require strong local political and business champions who can communicate its advantages locally, while justifying to other parts of the country why Atlantic Canada merits such preferential treatment (or indeed why some parts of Atlantic Canada should be favoured over others).

Certainly it is in the national interest to alleviate the region’s generational disparities; if SEZs did nothing but displace existing failed policies they would be of some benefit, as much to Atlantic Canada as to taxpayers elsewhere. Moreover, SEZs need not be a zero-sum game: a new Atlantic container terminal, for example, would compete predominantly for business with U.S. ports, not Québec and Ontario. An Atlantic Canadian SEZ could be a net gain for Canada.

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It would be wrong to dismiss the most economically dire Atlantic Canadian regions as lost causes. In Cape Breton, the operations of internationally successful companies like Protocase and Slyce suggest the potential for growth in skilled manufacturing and information technology, given the right conditions. But time is of the essence. As the population ages and the brain-drain worsens, it is imperative that our political leaders take bold measures to turn the region’s fortunes around. In a real sense, it is now or never.

There are compelling reasons to look more closely at this idea, with its potential for reshaping economic development policy in the region. My hope is that, in the course of this election campaign, candidates in Atlantic Canada will find time to debate it. After many years of disillusionment, the people who elect them deserve a consideration of all the options.

National Post

Jonathan Yazer is a graduate of the Global Governance Master’s program at the Balsillie School of International Affairs.