China’s “Rough Trade” with Canada
Canadian politicians state to Canadians that vital trade links must be maintained with China for Canada to prosper on the world stage as an economic superpower, Canadians for the most part are buying it. But is China's Rough Trade with Canada giving Canadians a raw deal?
Recently I attended a political fundraiser in support of a political candidate; I listened intently to what this politician had to say. The subject of Canada-China trade relations came up, with the political candidate passionately envisioning the importance of continued trade ties with China.
While I am not an expert on import and export logistics, I do know what a trade imbalance is. I brought up the subject to the political candidate that our continuing trade imbalance with China has not been a fair trade ever since Canada started a trading dialogue with China decades ago. I further stressed to this political candidate for continued trade ties to work effectively for the economic benefit for both our countries, import and exports need to be a two way street. Canada pre 1980s was a manufacturing superpower with the world, with countries all over the world clamoring for our Made in Canada products.
Since the China-Canada trade inception, Canada has lost its birthright as a manufacturing nation, resulting in Canadians becoming a consumer society of haves and have not’s. What would you do if elected to serve all Canadians to ensure a fair deal for Canadians? Unfortunately the political candidates response amounted to a “Deer in the Headlights” look, eliciting a non response and a quick change of subject.
The audience sat in silence, though nodding in agreement to my questions, some with a thumbs up, with many continuing to look back to me where I was seated in the hopes I could continue to provide more information, clearly they needed it. Since this was not my political forum, but the political candidate, I went back to finishing my fundraising meal I paid for and left disappointed.
Made in China merchandise, geared for Canadian import and purchase by retail companies or controlled and wholly owned subsidiaries by Canadian manufacturers at home for the 34 million Canadian consumers’ amount to a $40 billion dollar industry (2009-2010).
China on the other hand with a population of 1.4 billion people, export only $10 billion dollars (2009-2010) from Canada, the majority of exports purchased is in the form of raw materials, not Made in Canada merchandise. Certainly China’s rough trade practices with Canada show we are being taken without the benefit of pillow talk afterwards. Why Canadian politicians continue to salivate for the Chinese markets with countless taxpayer paid junkets is beyond financial logic.
Refer to the Slideshow for Statistical Information on China and Canada on Chinas ongoing trade inbalance against Canada.
These purchased Canadian exports to China equate to a fractional $3.00 per year for every Chinese man, woman and child when compared to Canadian consumer purchases at $564 for each Canadian man, woman and child.
Certainly a major trade imbalance between both our countries seems to be on the side of China.
While Canadian politicians continue to travel on fact finding tours of Chinese factories, some owned by Canadian companies back home, or trying to induce Chinese investment and trade with China who is really, really benefitting? The Canadian consumer? Certainly there are many in business and political circles that think so, or at least tell us that. Little do Canadian consumers realize that China is our Breadbasket for many foodstuffs cheaper than Canadian farmers and Canadian fisherman can grow or catch. One report in the past showed consumers who became ill from seafood from China shown to contain malachite green, a chemical that can cause cancer from farmed fish from China.
Arable land, especially in British Columbia soon falls prey to developers, so much for the 100 mile sustainable diet many wish for.
The question to ask ourselves, are Canadians being best served by Canadian Manufacturers who continue buy or manufacture goods Made in China?
While Canadian consumers look for cheap, are consumers putting their health and the health of their families at risk, given that “Made in China” goods in the last decade and currently today still reach our stores are still found to be tainted with everything from lead, mercury, asbestos, formaldehyde etc. Are Canadians being given the short shrift and being too complacent, or do politicians and Canadian manufacturers feel our health is the price of doing business with China?
While Canadian governments give a cursory chastise, resulting in no more than a finger wag to China over these tainted toxic products, business as usual seems to be the norm as China clearly ignores enforcing quality control measures against both Canadian owned/controlled or Chinese owned/subcontracted factories. Currently many consumers are lead to believe many food products labeled Made in Canada are from Canada. Apparently the majority of foods we eat such as seafood are not made in Canada, but come from China.
Canadian law dictates if the packaging costs more than the food it contains and the packaging is done in Canada, it is considered Made in Canada. How does this benefit the Canadian consumer? It only benefits the Canadian company who purchases the product from China.
Chinese governments seem to still be leaving the factory managers / owners to administer quality control, many times with fatal results both to the managers and Chinese consumers. While Canadian consumers may not have died from Made in China products yet, health ramifications to Canadian consumers is clear, perhaps for generations to come.
One wonders how long a Made in Canada manufacturer would be in business if they adhered to these Chinese quality control measures, especially if these toxic products harmed Canadians. Rest assured the justice would be swift, Canadian businesses would be immediately closed down by our Government, with hefty fines, lawsuits, including jail time for repeat offences. Does one think if the Listeria scandal which plagued Maple Leaf foods a couple of years ago would have been as litigious if a meat processing company in China had done this to Canadians? Canadians would be left to their own devices and most likely have little recourse, this considering past food quality practices by Chinese companies who export food from China. Well have all seen the tepid responses by our elected Canadian officials over similar cases in the past and present. China on the other hand makes a goodwill gesture, apologizes and shoots the factory managers in the back of the head and life goes on to do it all over again to Canadians.
One off topic subject I would like to bring up, though related solely with the U.S.A and Canada, is illegal immigration from Mexico. Mexican illegal migration in the majority of cases is the result of crushing poverty and unimaginable stratospheric unemployment which seems to have been ongoing since Christ was a child.
Mexico has had a shared history with both our countries for 400 years or so, with Mexico at one time owning the majority of Pacific West Coast and south western region of the United States. The only difference between us and the Mexicans is the U.S. – Mexican War which resulted in the loser, losing everything, including our respect.
Canada, U.S.A. and Mexico have a free trade agreement called NAFTA in place and have had one for over a decade. Currently Mexico is Canada’s 3rd largest trading partner, with the U.S.A being number 1 and China as our 2nd largest trading partner.
While Canada exports to Mexico are $5 Billion dollars, Canadian imports from Mexico are only slightly higher at a little over $5 Billion dollars. One can certainly see the balance in export/import equity between Canada and Mexico, versus Canada -China export/import inequities of $30 Billion dollars.
That $30 Billion dollar inequity China has with us year after year would be better directed for Canadians to purchase merchandise and foodstuffs from Mexico.
By increasing trade with Mexico, is an idea which should be furthered by our politicians as both countries enjoy better access and can provide financial inducements to Canadian and/or Mexican companies to set up manufacturing plants in Mexico versus continuing trade imbalances with China.
Would not reverting trade to Mexico be a better economic alternative for both our countries? Canadian and Mexican industries would provide employment to the citizens of Mexico and perhaps help stem the tide of the impoverished illegal migrant, instilling pride in Mexican citizens in providing for their families.
Canada and Mexico would and should enforce higher cost of living salaries for Mexican citizens versus China’s reluctance to raise the salaries or cost of living for its own citizens who average $10.00 - $12 a day for a 10-12 hour day, 6-7 days a week.
Canada and Mexico ensuring fair wages, fair import/export practices while maintaining Quality control of manufactured goods and foodstuffs would ensure the health of consumers in Canada, U.S.A and Mexico. The added benefit would give all three countries the satisfaction of doing the honourable thing, that is helping a centuries old neighbour get its pride and honour back, economically and emotionally, who would in turn help us stem the tide of illegal migration, war on drugs and violence what Mexico is now known for. If Canadians and U.S. Consumers still want cheap (merchandise and foodstuffs) then Mexico is the way to go. The U.S.A. has also been plagued with Made in China contaminated merchandise and foodstuffs will also be one of the biggest winners in all this, U.S. consumers would be able to buy more locally, in addition perhaps a savings can be had in reducing the cost in the multi billions in taxpayer dollars spent on its war on drugs and protecting its Mexican U.S. border from illegal migrants, who migrate the U.S.A for work.
While the U.S.A. economy is tied to China, as China currently holds close to a trillion dollars in U.S. debt owning a vast share of U.S. Treasury Bills, which would devastate the U.S. economy if China ever decided to cash in those U.S. Treasury Bills.
The U.S.A most likely would not follow this idea of reverting all or a portion of its Chinese import trade to Mexico, as a country beholden to China in maintaining its economy.
Refer to the Slideshow showing the inequality of Import/Export trade between the U.S.A. and China.
Looking at the U.S. figures in the slideshow over the past decade, it boggles the mind how this trade inequality with China can be good for U.S. Consumers, much like Canada, China is clearly the winner hands down.
While Canada is not economically beholden to China such owning our Debts, like our U.S. neighbours, Canadian consumers need to know it seems politicians may not have our best interests are at heart.
While many dispute the CSIS report that China is using influence with Politicians in continuing the status quo in everything from imbalance Import/Export trade and a host of other issues Canadians are not privy to. The case made by CSIS against China and politicians is not without merit. If Canadians had to believe a politician or CSIS in this case, the evidence in this commentary/opinion report is frightfully clear, something is amiss, perhaps Canadians should have a rethink and ask questions such as the questions I have posed in this story of their elected representatives and demand answers, if you are greeted with that “Deer in the Headlights” look, you may find this a trait many politicians share!