(Vancouver) Trade between China and Canada reached record levels in 2022, as imports from China crossed the $100 billion mark for the first time, according to Statistics Canada data.
Economists and other observers say companies are looking past political tensions between the two countries as demand surges and supply chains return to normal functioning in a post-pandemic world.
James Brander, professor of economics at the University of British Columbia’s Sauder School of Business, pointed out that where there are no government policies in place—such as those currently restricting trade with Russia—companies will not prioritize policy.
“Of course, yes, there are tensions. Economic or trade flows, and economic activity in general, are not affected much by political tensions, unless there is a clear policy,” Brander explained.
Statistics Canada data shows that Canada imported $100,027,968,000 worth of goods from China last year, up 16% from $86 billion in 2021.
The largest category of imports in 2022 was consumer goods with a value of 31 billion, followed by electronic and electrical equipment with a value of 28 billion.
The data shows that Canadian exports to China also reached an all-time high of $27.9 billion, as it recovered from the slump that followed the arrest of Chinese Huawei CEO Meng Wanzhou in 2018 and China’s detention of Canadians Michael Spavor and Michael Kovrig.
Last year, China lifted a three-year ban on Canadian canola that had been imposed after the arrest of Meng, who has since returned to China.
But tensions between Ottawa and Beijing remain high, amid allegations of Chinese interference in Canadian elections and the government’s assertion of Chinese surveillance.
Anastasia Yofimtseva, program director at Canada’s Asia Pacific Foundation, noted that although economics and politics are “very intertwined,” it can take a long time for them to come together.
In the meantime, she explained, companies will respect the dynamics of global trade and seek cost-effective solutions.
“It is likely in the future that we will see changes in trade, and it could spread, but we still have to be careful about all the factors that companies take into account when making their decision.”
MI Yofimtseva added that it was not easy for companies to find alternatives to China, the world’s second largest economy.
“Although many countries say that after the pandemic they want to create an alternative structure for the supply chain, change is expensive and difficult to change when a company is established and has its suppliers. It will take a long time to find alternatives to build this infrastructure.”I Yofimtseva.
She added that the existing supply chains have stabilized after the pandemic disruptions.
Economist Daniel Trefler of the University of Toronto said that manufacturing supply chains cannot be easily moved.
“Of course, this is very difficult,” Treffler said. It is impossible to do this in a short period of two, three, four years. »
Last week, the Chinese Consulate in Vancouver rejected a newspaper article Globe and Mail Outlines alleged efforts to oust candidates seen as hostile to Beijing. The consulate said the report “slanders and defames” China.
For their part, the Canadian Ministry of Defense and Armed Forces confirmed last week that they are aware of China’s recent efforts to conduct reconnaissance operations in Canadian airspace and waters.
This post was produced with financial assistance from the Meta Exchanges and The Canadian Press News.
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