By Doug Palmer and Louise Egan
WASHINGTON/OTTAWA (Reuters) - President Barack Obama and Canadian Prime Minister Stephen Harper agreed on Friday to a new approach to U.S. and Canadian security that they said would help boost trade by reducing logjams at the border.
"Today we've agreed to several important steps to increase trade, improve our competitiveness and create jobs for both our peoples," Obama said at a joint press conference in Washington.
"The United States and Canada are not simply allies, not simply neighbors. We are woven together like perhaps no other two countries in the world," Obama said.
Harper told reporters the two countries would work together "in the context of a North American security perimeter" to fight terrorism and other threats.
"We're not talking about eliminating the border but rather simplifying, wherever possible, the management of the border as well as the free flow of people and goods across that border," Harper said.
The United States and Canada are each other's biggest trading partners, with about $1.5 billion in goods and services and 300,000 travelers crossing the border each day.
Much of the trade is between companies producing a final manufactured product.
Business groups in both countries have long been concerned about the "thickening" of the 5,525-mile (8,900-km) U.S.-Canadian border due to security measures enacted after the September 11, 2001, attacks on the United States.
"Jobs and prosperity in both the U.S. and Canada are at stake because our economies are interdependent," said Myron Brilliant, U.S. Chamber of Commerce senior vice president of international affairs.
"By rethinking how we confront common security threats and modernizing our approach to cross-border supply chains, both of our countries can become more globally competitive," Brilliant said in a statement.
Obama said the two countries would now "develop an action plan to move forward quickly," focusing on areas like improved screening, increased information sharing among law enforcement officials and early threat identification.
The two countries also agreed to work to together to reduce regulatory barriers to trade, which hit a record $600 billion in 2008 but slumped to $403 billion in 2009 after the global financial crisis sent the U.S. economy into recession.
"This is the kind of government action that we in the business community have been seeking for years," said Linda Hasenfratz, chief executive officer of Linamar Corporation, a leading Canadian automobile parts manufacturer with more than 10,000 employees in 37 plants around the world.
"By improving our ability to trade across the border, today's agreement will promote job creation, investment and growth in both Canada and the United States," Hasenfratz said.
In Ottawa, Michael Ignatieff, leader of the opposition Liberals, criticized Harper for secrecy in negotiating the border agreement and said he worried Canadian immigration and refugee policies may be subordinated to U.S. interests.
"We have different standards than the Americans on these questions. We have a right to do so," he said. "If we get into a perimeter security deal that weakens Canadian sovereignty, we may end up betraying Canadian values."
Harper said the increased cooperation with the United States did not pose a threat to Canadian sovereignty.
"It is in Canada's interest to work with our partners in the United States to ensure that our borders are secure and to ensure that we can travel and trade across them as safely and as openly as possible within the context of our different laws," Harper said.
(Editing by Peter Cooney and Paul Simao)