The Great Rethink: If Canada wants to stay a trading nation it needs to up its game
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“Some other foreign markets are growing more quickly than the U.S., but it’s highly unlikely that any of those markets are going to supplant the U.S. in dominance,” said Avery Shenfeld, chief economist at CIBC World Markets.
Experts say Canada’s approach to trade in the future will have to be a mix of learning to deal with a more protectionist U.S., while finding new opportunities on the margin. Trump’s focus has been steel and aluminum, but that could easily expand to other sectors, and indeed may already touch other sectors.
Simard, the head of the Canadian aluminum lobby, said that any changes in aluminum exports to the U.S. were the result of COVID-19 lockdowns. As the economy gradually returns to prior conditions, trade is getting back to normal, he said.
But Trump’s tariffs will continue to disrupt the North American manufacturing industry. Bernard Wolf, a professor of economics at York University’s Schulich School of Business in Toronto, said the automotive industries in both countries were already in decline, as production has moved to jurisdictions with cheaper labour.
“I think we’re losing it, but it’s been a slow burn kind of thing,” he said. “Protectionism would certainly accelerate it.”
Canada is looking at diminishing economic prospects for the next decade because of CUSMA
Dan Ciuriak, an economist and senior fellow at the Centre for International Governance Innovation, said Canada is looking at diminishing economic prospects for the next decade because of CUSMA.
In a paper published this summer by the C.D. Howe Institute, Ciuriak found that the agreement would reduce annual gross domestic product in the U.S. by 0.12 per cent, in Canada by 0.4 per cent and in Mexico by 0.79 per cent.