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"NOYB" wrote in message k.net... This is more than US vs. China. Japan, Europe, and Canada are joining the US in our displeasure with the unfair trade practices being committed by China. Today's data will bring this issue to the forefront...and it won't be long before the "T" word (tariffs) becomes all the talk in the Capitol and on the news. Just watch. Please leave Canada out of your rant. Canada enjoys it's trading status with China. Please read the statement from one of Canada's experts on Foreign Trade. Jim Understanding Canada-China Trade - May 19, 2004 By Stephen S. Poloz, Senior Vice-President and Chief Economist , Export Development Canada There is a view making the rounds that Canada is getting the short end of the stick when it comes to trading with China. We buy more from them than they buy from us, and mostly they buy our raw materials and sell us high-value goods, like DVD players, or so the argument goes. It is true that China is adjusting only gradually to the rules of international trade, and is not all the way there yet. But this is not unlike the phasing-in that other countries typically go through after negotiating a free trade agreement - Canada included. More importantly, China is on track to become the largest economy in the world. Its consumer class will expand, its service sector will dominate economic growth, and it will require sophisticated infrastructure. Chinese consumers will want to fly on airplanes, talk on cell phones, work on computers, watch North American movies, visit Canada, and will buy cabinets, doors, windows and hardwood floors for their houses - many of which are Canadian strengths. Canada's exports to China are not all rocks and trees, even today. True, about 45% of our $5 billion in sales to China are resources, including agri-food, forestry, metals and minerals. Another 18% is in chemicals and plastics. But over 25% of our exports are manufactures, of which a third are automotive parts and tooling. Another 11% of our exports to China are services, including tourism (Chinese visits to Canada) and engineering, consulting and other professional services. Critics respond that our imports from China have grown much more than our exports, so we are losing by that trading relationship. This is, quite simply, the wrong way to look at trade. Every international transaction benefits two parties - the exporter and the importer - regardless of which direction the sale is going. Canada benefits from being able to purchase inexpensive DVD players, footwear or clothing; this gives us more purchasing power than we would without trade with China, and the leftover money gets spent as well - and about 70% of every dollar we spend goes on Canadian goods and especially services, which helps our service sector grow. Furthermore, our exporters benefit by importing components from China to build into their products. This boosts productivity and lowers costs, which means more export sales to the U.S. and elsewhere. Trade should more often be seen as triangular, rather than bilateral - it is quite reasonable to have large trade deficits with some countries (which may be mainly suppliers) and surpluses with others (mainly customers) to maintain an overall balance. Where are the big opportunities in China? There will be massive investments in power generation, transportation, mining, waste treatment and water purification, where Canada can supply services and goods. Farm and medical equipment, automotive tooling and robotics, pharmaceuticals, engineered wood products and education services also have high potential. The bottom line? Trade with China is already delivering big benefits to Canada, and we expect two-way trade to grow rapidly in coming years. But it is important to remember that trade is not just about exporting - the benefits from trade come from both exports and imports. The views expressed here are those of the author, and not necessarily of Export Development Canada. Home - Top of Page - Search - Site Map - Contact Us - EDC Direct © 2005 EDC. Terms of Use - Site Optimization - Privacy Policy |
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