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WASHINGTON - Americans will be required to show U.S. passports when they re-enter the United States from Mexico, Canada and the Caribbean by 2008 under proposed new rules announced Tuesday by the State and Homeland Security departments.

The new policy, which would be phased in by 2008 and is designed to thwart terrorists from exploiting the relative ease of travel in North America, means that Americans who lack U.S. passports would have to obtain them to travel between the United States and neighboring nations. It also will require Mexicans and Canadians to present passports or another official document to enter this country, with details to be determined.

The regulations mark a dramatic shift from a policy that allows Americans to return home from neighboring countries without a passport.

Once the new system takes effect, people entering the United States from Mexico will continue to be able to use a border crossing card or SENTRI card instead of passports. These cards are obtained after background checks and other security measures.

More than 48 million people entered the United States through the San Ysidro Port of Entry in 2004, and more than 14 million came through the nearby Otay Mesa Port of Entry — which were record highs for the two passages linking San Diego and Tijuana.

Charles Showalter, president of the National Homeland Security Council, a union representing 22,000 federal employees including inspectors at the ports of entry, said the new requirement would probably have little impact on wait times at borders. Inspectors already examine documents at border crossings, he said.

Since the 2001 terror attacks, many U.S. citizens have been advised by immigration attorneys and travel agents to travel with passports.

“I always advise my clients to use a passport when traveling to Mexico or Canada,'’ said Paula Quon, owner of a San Francisco travel agency and Northern California chapter president of the American Society of Travel Agents. “For security reasons, it’s easier to get in and out'’ with a passport, she said.

An estimated 60 million Americans — about 20 percent of the national population — have passports.

The changes were mandated by the intelligence-reform law approved in December and have been expected for months.

Secretary of State Condoleezza Rice said U.S. officials have been working with their international counterparts “for some time'’ to shore up security measures without crimping the flow of commerce across borders.

“There’s a very strong awareness that these are tremendous commercial borders and that you don’t want to hinder the commercial activity,'’ Rice said in an interview with the Associated Press. “But at the same time, you’ve got to have some controls that help you prevent people who are trying to come in and hurt us.'’

Canadian Public Safety Minister Anne McLellan said U.S. citizens may need passports to cross the northern border if the U.S. follows through with its regulations.

A representative of the Mexican Embassy in Washington said the regulations “won’t affect the tourism flow or people who trade and do business between the three countries in North America.'’

The new requirements would take effect Dec. 31, 2007, for travelers entering the United States from Mexico and Canada by land, and on Dec. 31, 2006, by air or sea.

Currently, Americans generally need to show a driver’s license or other government-issued photo identification to cross the border from Mexico or Canada.

Mercury News Staff and Wire Services. Mercury News Staff Writer Edwin Garcia, Associated Press and Washington Post contributed to this report.