Politics aside, Canada continues to engage and grow trade with China

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The current political climate between Canada and China could be called chilly, however the strained diplomatic relationship seems to be having little impact on the real world economic and trade relationship.

Carlo Dade, director of the trade and investment centre at Canada West Foundation, says that despite political tension, trade with China is increasing. Why doesn’t Canada’s political stance match its trade strategy?

In a word, Dade says, it’s consumers.

“There’s a reality to the market, this reality of what people need and what people produce. And that seems to have a countervailing impact to the political issues and the security issues,” he says. (More below)

Trade with China is complicated by sometimes-opposing views on what rules-based trade looks like. Fundamentally, there are differing philosophies on what’s a “good” trade rule according to China versus according to Canada, Australia, or the U.S.

“China needs the international [trade] system to work… in ways that don’t deliberately try to harm China or undermine the the success they’ve had in growing the economy and eradicating poverty. China needs the international system to work for it to continue to grow and to continue to prosper,” Dade says.

Canada has to continue to navigate a relationship with China, because, frankly, the Chinese economy is number one in purchasing power on the global stage. There’s just no way around it.

“It’s not the Soviet Union or the ex-USSR economy with which we didn’t engage [but] that didn’t impact us economically,” Dade says. “This is the world’s largest or second largest economy, and how do we deal with this competing vision of how an economy should be organized and how international trade should work?”

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