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Trumpβs tariff threat is a sign that Canada should be diversifying beyond the U.S.
(theconversation.com)
Oh, great idea. Nobody ever thought of that before.
this post was submitted on 15 Dec 2024
140 points (100.0% liked)
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Honestly? They really didn't. For a while Canada emphasized US trade for security reasons. We really should be developing closer ties to the EU.
Every province and industry has been holding trade missions for decades to diversify markets. It's not that it's easy to disconnect the US apron strings, but it's certainly been at the top of any trade organizations mind since at least the 70s.
Since we've had disputes like softwood lumber and BSE, local value-added chains have been also a massive push to incentivize and fund. Things like packing plants, lumber mills, canola crush plants, mixed product pipelines to the coast, and all the shipping terminals that make that product go away take decades to plan and implement but are another piece of the puzzle of trade independence. Those things have been in the works for a long time and every dispute with the US in the last half century have added momentum to that push.
Yeah, unfortunately basic geography means there's likely a hard limit on how much diversification is realistic.
We absolutely should do everything we can to reduce our reliance on the US, but options become limited once you remove rail and road from the equation.
Plus, we really have not done much infrastructure spending in the last decade. I saw a report that said most of our public infrastructure is 20 to 40 years without significant maintenance. That's horrendous and not helping us diversify at all.
It's not a new concept, but it feels less like a speculative fiction and more like a serious policy idea now.
I'm really mystified by this lack of awareness of work done in the past on international diversification. There have been great strides made in where we were even 20 years ago for international trade excluding the US. I've been on unpaid boards (non-profit, industry) where that's been the primary focus for my entire term. We've worked with all levels of government to try to streamline trade barriers between Canada and other countries because nobody, private or public, trusts the US to not swing their dicks around, even with sympathetic administrations in place.
Honestly, it's kind of deflating to see that work ignored.
Good for you - and that sounds fascinating. At the end of the day 0 km of extra shipping is just a really good deal, though. Maybe you know if trade across the boarder has increased or decreased by percentage of our GDP, but I'm not hopeful.
I did learn recently that our free trade agreements cover waaay more geography than I would have guessed.
Canada is under utilizing that new second land border with Denmark
I second an application for joining the EU
Denmark is the most developed country in North America for a reason.
I've been saying this since before it was cool. (Pass the expensive burgers and fleece)
Denmark is so awesome thanks to proportional representation! We should learn from them on that.
We need more self sufficiency in manufacturing and agriculture.
Everyone does. Capitalism fucked everyone with outsourcing.
Yes i agree, but the problem with that is the goods would be expensive because of the wages that would need to be paid. It's one of the main reasons that this stuff left canada in the first place. We do have alot of agriculture here, but when it comes to some crops its chepaer for us to import it than grow it. I don't know how we would fix things, but there would need to be adjustments
So we would vy less companies would make less. Hopefully perfect world we would make more.
Paying people proper wages doesnβt increase the price much of goods and services much.
as an example, do you think a iphone made in china vs made in canada would be the same price? because it wouldn't be. The reason products from china are so cheap is because of cheap labor
Cheap. When is a iPhone cheap. Elastic pricing people by it they keep raising prices and pocket the money.
It is not as simple as that, as China is really good at the markets of scale strategy. We could have the same thing here in north america that could reduce the transport costs and keep the money/expertise within the continent.
Instead the companies are allowed to offshore the jobs to lower the working standards and the wages.
We used to have call centres here and yet a lot of them moved to India.
But that's the point. The only things keeping products at their prices now are keeping jobs offshore. Also the wages people would want to be paid to manufacture base goods would be quite higher than what china pays their workers (and im not saying that's a bad thing). What transport costs make it more expensive than shipping overseas?
Would have been nice of the author to mention the massive amount of trade deals that Canada already has.
Canada is the only G7 nation to have free trade agreements with every other G7 nation. The wikipedia page on Canadas trade deals is huge, 15 free trade agreements with 51 countries.
And most of the countries he suggested in the article are under active negotioation, the big ones being:
- ASEAN
- Indonesia
- Mercosur
Canada could have free trade agreements with every country on the planet and would still probably trade more with the US because they're right there, they make a lot of stuff, and are the worlds largest economy... We cant teleport goods around the planet yet.
I think that targeted public funding to create domestic industries would be a much better way to secure the economy against US isolationism. Specifically in high tech industries. Why export 100$ worth of lumber to buy 1000$ worth of chairs if youll pardon my gross economic oversimplification.
Maybe A few dacades too late π€·
Yeah, I've actually come to think a smaller tariff would be good. There would be short term pain, but it would produce reorganisation away from the US.
Wow... Almost mainstream media saying so. They do delay mentioning China for a few paragraphs, but that is clearly the answer, if the auto/EV plant investments are cut off from US competitiveness.
Canadian politicians and media need to reject their CIA allegiances. The obvious role China can play is investing in natural resource extraction. Ask for 50/50 joint ventures in industry that processes those materials with options to buy a share of the production, and export a portion of value added processing as well as raw materials. Canada should withdraw from NATO if US puts tariffs on it. Rutte demanding extra US sycophancy by boosting military spending to 3%, and sacrificing pensions, healthcare, and social security to do so, and our media runs stories of "mandatory draft" and absurd threats to Arctic that are met by F35 purchases somehow.
All NATO colonies have significant GDP lag compared to US since Ukraine fiasco. The idea to reward Trump by importing more US weapons should be a repulsive reaction to the subjugation that Biden inflicted. Copying tariffs without Chinese consultations was by far the most pathethic act of submission of our Government, and Trump is "rewarding" our cowardice.
I've sometimes thought we could adopt the Euro as a currency, though it would remove our ability to float the dollar to change export/import ratios.