new trading strategy
Canada wants to free itself from dependence on America
11/28/2022, 12:16 am
Canada has long aligned itself economically with its larger neighbor to the south. But the US is adopting an increasingly restrictive course in foreign trade. So Canada wants to diversify its trade and is looking mainly towards Asia.
Canada seeks to expand its relations with Pacific countries and thus seeks to shift its one-sided focus on trade with the United States. It envisages a new Indo-Pacific strategy, for which 2.3 billion Canadian dollars (1.65 billion euros) has been earmarked, which will flow into weapons and cyber security, among other things. The plan is to deepen ties with over 40 countries in the Pacific region.
The background of the restructuring is the increasingly restrictive course by the United States in economic relations and the growing criticism of free trade. The stated goal of the government of liberal Prime Minister Justin Trudeau is the diversification of trade ties. The US accounts for 68 per cent of Canada’s foreign trade, while China accounts for just 7 per cent, according to official figures from September.
However, China is also considered problematic in the new strategy. With regard to the People’s Republic, the 26-page strategy paper states that foreign investment rules will be tightened to protect intellectual property and prevent Chinese companies from gaining access to domestic mineral resources. Conceptually, China is a “disruptive power”. Still, cooperation with the world’s second-largest economy is essential in tackling problems such as climate change or limits on nuclear weapons.
New confederation of states in the Pacific region
Canada’s move comes after efforts by Western countries to counter China’s growing influence in the region. The US launched an informal federation of states last summer to strengthen ties with the Pacific island nation. The so-called Partners in the Blue Pacific (PBP) also included Australia, Japan, New Zealand and Great Britain. They wanted to promote economic relations between the rest of the world and the Pacific states.
US President Joe Biden has announced a larger US presence in the Indo-Pacific amid efforts by China to expand its own economic and military ties to the region.
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