In this Bloomberg article, Wingrove discusses the possibility of trade ties between China and Canada growing stronger. While the Canadian public is skeptical of softening relations between the two states given China's human rights record, it seems like Canadian officials are keen to improve trade agreements with the East Asian country.
While the Trans-Pacific Partnership (TPP) was not discussed in the article, one wonders if Canada's urgency to improve ties is a result of the trade deal failing. One of Trump's first moves as president was to cut the deal which would create an economic bloc, similar to the EU, that would comprise a significant portion of global trade. The 12 countries involved comprise 40% of the global GDP with China left out of the agreement.
In response to the US bailing on this deal, China has proposed their own deal to replace the TPP. The Regional Comprehensive Economic Partnership (RCEP) aims to create a trade bloc between China, India, Japan, South Korea, Australia and several other East Asian and South East Asian countries. If the RCEP passes the agreement aims to comprise 30% of global GDP. While Canada is not a part of this deal, it is quite possible to speculate that they were relying on the TPP as an alternative to freer trade with China. However, with the TPP out of the equation and with Trump's continued support for protectionist polices, we might see China attempting to cement itself as the leader of liberalized trade in the world.
China has already publicly declared these goals. The president of China, Xi Jinping, has spoken critically of the president's protectionist polices. At the World Economic Forum in January, Xi stated that "pursuing protectionism is like locking yourself in a dark room, which would seem to escape the wind and rain, but also block out the sunshine and air." These are words which we unfortunately must hear from the president of China and not the president of America.
The TPP was speculated to create thousands upon thousands of jobs in the next 10 years and beyond. Instead of this, our president is tirelessly trying to his best to save jobs in America which will most likely be gone (once again) in the next 10 years. We now see some of our most important trading partners looking towards China for more prosperous opportunity.
Link: https://www.bloomberg.com/politics/articles/2017-04-02/trudeau-ramps-up-courtship-of-xi-amid-china-free-trade-talk
2 comments:
This would be of great importance to Canada, given the failing of the TPP. The Canadian government is more keen to improve relationships and that just shows the reliance on other nations can bring about numerous benefits for both sides. The acquisition of raw material is one of the most important when it comes to production functions and manufacturing, so having access to these in a cost-effective way will be vital for Canada's economy.
China and Canada are huge trading partners with the United States. I would be interested to see how a closer relationship between China and Canada would diminish trade with the US especially when it comes to secondary goods for final good production. It seems to me that trade agreements between Canada and China lead to lower cost and this would be a way to cut out US manufacturers.
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