Last week, Prime Minister Harper was in Seoul, South Korea, signing another victory in the name of the Conservative government. Specifically, he signed a free-trade agreement with the country, adding to the recent trade agreements with the European Union last October. All of these together are estimated to boost the Canadian economy by around $13 billion.
Many, though, are wondering why the Conservative government is pursuing trade with a large variety of nations, as we have always had a steady and stable partner in the United States. The biggest problem with this is that the strength of our economy was very tightly tied to the strength of the American economy, which could be headed for turmoil in the near future.
One of the reasons for the diversification of Canadian trade is because of this reliance on the United States as a trade partner. As of 2007, 77% of all of our exports went south to our neighbours, leaving very little for us to trade with the rest of the world. As long as the American economy remained strong, we had little to fear. But this situation may not last much longer.
America doesn’t want the construction of the Keystone XL pipeline? Then we’ll sell our oil to China.
According to the Congressional Budget Office, without massive change to the current laws, America’s debt will reach 100% of its Gross Domestic Product (GDP) by 2038, and would continue upward from there. In other words, within the next 25 years, the world’s most powerful economy will collapse, unable to sustain itself any longer. That’s not exactly a train we want to hitch ourselves to.
Diversification of trade allows us to have more of a say in our trading relationships. In a situation where we are solely dependent on the United States for certain resources, they have been able to force us to accept terms we did not necessarily want in order for us to acquire what Canada needs. With a more diverse trade portfolio, we are able to shop around, and find the best deal amongst many nations.
More trading options also allows us a better bargaining chip at the negotiation table, as we have seen in recent years concerning the export of our oil products. America doesn’t want to get on board with the construction of the Keystone XL pipeline? Then we’ll build Northern Gateway and sell our oil to China, something that would have been unheard of in the past, as the United States could have attempted to retaliate for the loss of this vital resource.
These new trade agreements have opened up a wealth of possibilities for the Canadian economy, and will continue to help our economy stay strong in the face of continued economic uncertainty.
Canada is projected to lead the G7 nations economically for the next 50 years, according to the Organization for Economic Co-operation and Development. As we do so, Canada’s economic diversity will help us to remain strong in the future.
Are you saying that selling our oil to China, letting them refine it, then buying it back at a higher cost is BENEFICIAL to us?
Why not build refineries in Canada, create Canadian jobs, eliminate the hefty mark-up on the oil, and prosper? Harper is selling us out for a quick buck, and you know it.
No, I never said that. I said that having a more diverse trade portfolio gives us the option to sell to China if the United States doesn’t want to play ball. Nowhere did I make a commentary on anything you have claimed I said.