"This is perhaps the wake-up call that people need," said Nancy Hughes Anthony, president of the Canadian Chamber of Commerce. "We have to take it very seriously and be prepared to compete."Okay, first off, Nancy Hughes Anthony has too many names. Secondly, she apparently can't do basic math.
Canadian GDP: $1 trillion
Chinese GDP: $7 trillion
Foreign trade is always relative to the size of the overall economy - Canada simply cannot compete with the Chinese in terms of overall dollars. We shouldn't even be trying. Frankly, it's amazing that we've managed to keep up with the Chinese until now. Things we can derive from these basic numbers, however: Canada's trade is far more dependent on the US's economy than China's. That's something we should remedy, and quickly. Especially with the uncertain future created by the Bush Administration, Canada should be working hard to lessen it's dependence on American goodwill.
Fortunately, in the same article (albeit much lower) the Globe quotes someone sensible - who incidentally explains how we've become so vulnerable to a US shock:
Although Canadian politicians will no longer be able to trumpet their first-place status with the United States, other Canadians shouldn't worry too much, said Michael Hart, chairman of trade policy at Carleton University's school of international affairs."North American supply lines are 'deeply integrated'". Thank you, Brian.
Because China and Canada differ so much in the types of exports they sell to the United States, Canada should not feel threatened by China's ascent, he said.
Most of Canada's exports to the United States are a result of cross-border industrial production, Mr. Hart said, and North American supply lines are "deeply integrated" and not about to disappear.
2 comments:
Your China GDP figure must be a PPP one as the nominal figure was about $1.4 trillion last year.
The World Bank ranks China as having the seventh biggest economy, after the U.S., Japan, Germany, Britain, France and Italy.
PPP figures are usually used to compare standards of living in different countries by adjusting for price differences. I might be wrong, but I don't think it has much application in explaining trade flows.
You're probably right. Still, the point stands that China's economy (even in nominal terms) is now larger than Canada's - about 40% larger, if you're right. Again, it would make sense that China's trade could be larger. Given that China's GDP will grow much faster in the next few years, there's no reason for us to kill ourselves over this.
Post a Comment