THE TTALK QUOTES

On Global Trade & Investment

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No. 48 of 2016

WEDNESDAY, JULY 20, 2016

Filed from Portland, Oregon



Click here for last Friday's quote from Bruce Stokes. 
FROM A CHALLENGER:  ON CANADA-CHINA TRADE



"Prime Minister Trudeau has adopted a timid approach - very timid - regarding trade with China.  That won't help us grow economic prosperity."



Maxime Bernier

July 18, 2016

CONTEXT

First the man, then the policy.



Maxime Bernier is a challenger in more ways than one.  A Member of Parliament from Beauce - it's just south of Quebec City - and a former Minister of Foreign Affairs in the government of Prime Minister Stephen Harper, he has thrown his hat in the ring to be the next leader of the Conservative
 Maxime Bernier

Party of Canada.  When Prime Minister Harper resigned following the Conservative's defeat last November, Rona Ambrose of Alberta was chosen as the party's interim leader as well as the Leader of the Official Opposition. 



The "permanent" leader of the Conservative Party - (nothing is "permanent" in politics) - will be chosen in a party election next year.  It is scheduled for May 27, 2017.   This past May, Mr. Bernie entered the race for leader and is now one of five candidates formally seeking to become the next head of the party.  There well could be more.  So he is challenging his colleagues for the leadership of his party.



Canada's China Trade. As today's quote illustrates, he is also challenging the current administration on trade with China. On Monday, Mr. Bernier told the press that "now is the time to act" on a new Canada-China FTA, citing a study that suggested there would be a boost of some 25,000 Canadian jobs from such an agreement and significantly increased economic activity. 



An FTA with China is not a new idea in Canada, and Canada would hardly be the first country to have such an agreement.  Australia and New Zealand have free-trade agreements with China as do the ten members of ASEAN and some eleven other countries.  Those realities are part of Mr. Bernier's argument.  "Other countries are in negotiations with China," he said, "and other countries have free trade agreements with China. ... We don't want our products to be less competitive."

COMMENT: JUST TWO POINTS

First, yes, China is Canada's second largest trading partner - and from blueberries to oil to manufactured goods, it's a safe bet that that trading relationship is going to grow...a lot.  Canada's trade with China is, however, still dwarfed by her much larger trade with the United States.  China accounts for only about 6 percent of Canada's total exports and imports, while the U.S. accounts for roughly 71 percent. 
CANADA_S CHINA AND U.S. TRADE
GBD from Statistics Canada data.




 

Second, Mr. Bernier's comments caught our eye, but we do not mean to suggest that a Canada-China FTA would have to wait for a new government.  It is clearly an initiative Prime Minister Justin Trudeau and his government are wrestling with now. But there are complications.  One is the Canadian public's wariness of a closer engagement with China.  On that front, Mr. Bernier's remarks can't hurt.  Then there are China's demands, including a new pipeline to the West Coast.  

We don't know how all of this will play out or how it may play into America's current dark discourse on trade.  But it is an issue worth watching.

SOURCES & LINKS

Bernier Wants a Canada-China FTA.  This take you to the iPolitics  story of July 18 by BJ Siekierski on Maxime Bernier's call for a trade deal with China.



Five in the Race is a link to the Wikipedia entry on the Election for the Next Leader of the Conservative Party of Canada, including both the current announced candidates and others who are seen as likely to run.



From Statistics Canada takes you to the page of this organization's website with the data used in the table above.  Briefly, and rounded to the nearest C$ billion, Canada's 2015 exports to China amounted C$21 and her imports from China that year were C$39, generating a trade deficit of C$17 billion.



Canada's trade with the U.S. in 2015 consisted of C$397 exports, C$363 imports, with a trade surplus of C$34.



Trudeau to Discuss is a Council of Canadians article on this topic - a possible Canada-China FTA - from early last month. 

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