As US adherent, Canada cannot gain much from trade with China

As neighboring countries and close partners, Canada and the United States share common interests in various fields. But despite that, the two countries’ relations have seen twists and turns, including trade disputes, recently.

The US administration has adjusted its foreign policy, making settling trade disputes with other countries its priority. The US has been exerting enormous pressure on most of its trade partners, including Canada. The US president even took a jibe at Canadian Prime Minister Justin Trudeau at the G7 Summit in Quebec, Canada, in June, revealing the two leaders’ tenuous personal relationship.

The US economy is about 10 times the size of the Canadian economy, and Washington has a dominant political and economic influence across the world. And since Canada is highly dependent on the US economy, it even has to accept most of the US’ diplomatic demands.

For example, in the first quarter of 2018, Canada’s exports to the US accounted for 75.8 percent of its total export volume and imports from the US added up to 52.3 percent of its total imports. On the other hand, US exports to and imports from Canada accounted for only 18.2 percent and 12.9 percent of its total exports and imports. Which makes clear Canada’s over-reliance on the US market.

Besides, the North American Free Trade Agreement was signed during the Bill Clinton administration to promote common development of the US, Canada and Mexico as their economies are complementary, setting an example for model regional economic integration. But the incumbent US administration used its overwhelming economic advantage to renegotiate NAFTA and forced Canada to agree to open its dairy product market to the US dairy industries.