The President of the United States

The White House

Washington, D.C. 20500

Dear Mr. President:

Our economic strength is a bedrock of our national security and the diverse private sector representatives on your Export Council are deeply concerned that a lack both of resources and a sense of urgency could lead to a weakening of our nation’s economy as an unintended consequence of efforts to improve screening at our borders.

We refer to implementation of the Western Hemisphere Travel Initiative (WHTI). We are concerned that without effective implementation and communication, the WHTI will have a serious negative impact on legitimate commerce and tourism as well as on our diplomatic relationships with our two largest trading partners: Canada and Mexico.

Mr. President, we strongly believe that we can significantly strengthen our border security and ensure that valuable economic benefits continue to flow to the American people.

Impact on Trade, Travel and Tourism

The WHTI will impact cross-border trade by affecting the free flow of people and goods. Our land borders are a crossing point for more than $500 billion in surface trade between the U.S., Canada, and Mexico each year. Many of the border infrastructures between Canada, Mexico, and the United States already are approaching maximum capacity and represent a potentially significant bottleneck to the movement of goods. The WHTI runs the risk of making an already strained situation worse.

Without a thorough plan for execution, the WHTI also raises concerns about the objectives of the trilateral Security and Prosperity Partnership (SPP). Many private sector companies have been active participants in the U.S. Government’s efforts to enhance both security and prosperity through the SPP. Significant thought and support has been given to moving all forms of border clearance processes away from borders. This would be done in the interest of relieving the pressure created at borders by clearance of goods requirements, and enhancing security capabilities by providing pre-arrival information. WHTI, in its current form, will do nothing to advance this goal and may actually set it back.

Travel and Tourism is a $1.3 trillion industry in the U.S., accounting for 27 percent of all U.S. Service Exports in 2005. While the industry has made progress in recovering from the 9/11 terrorist attacks, international arrivals to the U.S. have continued to suffer, declining at a rate of 17 percent since 2000. An exception, however, has been travel from Canada and Mexico, which has increased 10 percent. More than 56 percent of total international arrivals to the U.S. in 2005 were travelers from Canada and Mexico, accounting for 20 percent of international travel and tourism-related spending in the United States and totaling over $20 billion in 2005. Based on these 2005 numbers, just a 10 percent decline in travel from Canada and Mexico would result in $2 billion less in visitor spending.

Since fewer than 30 percent of Americans currently hold valid U.S. passports and only 40 percent of Canadians possess passports, we are concerned that the impact on the travel and tourism industry could be significant, particularly because many people are not even aware of the new requirements, which go into effect for air travel on January 23, 2007. We believe more effort must be paid immediately to communicating the policy change and encouraging people to get passports. If confusion grows, we run the risk of adding yet another layer to the perception that a “fortress America” is being built.

A strong and concerted effort, starting with leadership from the White House, can ensure that we meet both security demands and the need to strengthen our economy.

Recommendations:

1) Ensure implementation is executed in concert with Mexico and Canada:

An approach that is unilateral, or even perceived as unilateral, could negatively impact the implementation of WHTI, our diplomatic relations, public opinion, and our economy. Any technology that is used or developed to process passports or other documents should be shared with the governments of Canada and Mexico.

2) Bolster Communication Efforts:

The Departments of State and Homeland Security currently lack a focused communications and outreach campaign to educate the traveling public about the new requirements. While information is available on their websites, most of the outreach has been driven by private sector communications to customers. The private sector is eager to help, but we believe the initiative needs urgent direction by your Administration so that all parties have a consistent message.

3) Increase the Focus on Technology:

Tomorrow’s competitiveness depends on our nation’s continuing ability to successfully adapt to a knowledge-based economy. It is imperative that the WHTI utilize adequate technology (such as processing pre-arrival customs information) to ensure goods can move across borders as freely as possible.

4) Ensure Adequate Resources:

DHS has not been given the resources necessary to implement the WHTI program effectively in the judgment of the General Accounting Office, many members of Congress and many private sector leaders. The requisite additional resources vary from border crossing to border crossing and include for example, additional CBP staff and additional physical infrastructure (e.g. pull-aside lanes). Additionally, the Department of State should be granted additional resources in order to accommodate an increase in demand for passports.

5) Underscore a Focus on Preparedness:

Although most businesses that operate on both sides of the border participate in various pilot programs (FAST, CTPAT, etc) where there are dedicated commercial lanes, there is a significant risk that delays in the other lanes will impede the ability to reach designated commercial lanes. On September 1, 2006, for example, anecdotal reports had five hour waits at the Niagara crossing at noon when DHS was testing a new system. Every hour of delay means lost productivity and revenue to U.S. businesses. DHS should be required to model the WHTI program at each of the busiest crossings before full-scale implementation to ensure that there are no unintended negative consequences of implementing WHTI.

6) Fully Implement “PASS card” or Passport Alternative:

The implementing agencies are required to develop a passport alternative or “PASS card” which we believe will help ease the burden of passport costs on some travelers. However, it is critical that the technological infrastructure to process the “PASS card” be properly installed and all employees at ports of entry be properly trained.

We believe that Congress established important milestones in the legislation that extended implementation of WHTI at land and sea entry points until June 2009. The PEC urges your involvement and monitoring of the implementation process to ensure that the twin goals of security and economic strength are constantly and vigorously met. We stand ready to assist in outreach efforts to U.S. citizens, our potential international visitors, and partnering governments to facilitate the transition and help the Departments of State and Homeland Security strike the balance between security and the free flow of goods and people.

Sincerely,

J.W. Marriott, Jr.