Globalization

Trade relationships are important because trade provides consumers and producers with a variety of goods and services at lower prices. Since the signing of the NAFTA agreement Canada вЂ" U.S trade relations have risen to the point where “80% of Canada’s merchandise exports” (pg. 130 Business Essentials) are to the United States. Canada’s dependency on the U.S is very strong and many believe that, “Canada has too many of its eggs in one basket.” (pg. 130 Business Essentials) The mounting concern of China, the fastest growing economy in the world today, affecting Canada- U.S trade relations is becoming a reality. In the article “China beats out Canada as top exporter to U.S” Heather Scoffield states that China has replaced Canada for being the number one seller of goods to the U.S. Nancy Hughes Anthony, president of the Canadian chamber of commerce believes that this new statistic is, “perhaps a wake-up call that people need”,(Globe and mail) Although both Canada and the United States are taking advantage of Chinas market the possibilities of a decrease in their current trade patterns is bound to happen.

Countries rely on imports to supply them with goods or services that other countries can produce less expensively and better. China has a “huge population, low literacy rates, and an unstable government” (pg. 125 Business Essentials) all are factors that allow them to produce goods and services at a lower cost and sell them to the U.S for a lower price. It is a challenge for Canada to compete with China in many markets, and therefore Canada’s main advantage over China is lower shipping expenditures. An example of this can be seen in the Canadian company Palliser, where manufacturers in China caused difficulties for Palliser to compete, therefore losing them trade with the U.S. (pg. вЂ"