Canada has an opportunity to reset our relationship with China – and, in a rare twist, on our terms
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L. Philippe Rheault is a lawyer and former Canadian diplomat, and the director of the University of Alberta’s China Institute, Canada’s largest research and policy institute dedicated to China issues.
Canada finds itself in a particularly vulnerable position on the world stage. It is more reliant than most countries on international trade for its prosperity – and a large share of that trade, not to mention its security arrangements, is tied to an increasingly unreliable United States, led by a President who seems intent on upending the postwar international order.
But it is not the only country reeling from the recent episodes of trade-policy vaudeville emanating from Washington. China is another. Despite putting on a brave face and having made herculean efforts in recent years to reduce commercial reliance on the U.S., China remains severely buffeted by U.S. trade actions. This comes as China’s economy already faces lingering headwinds: weak consumer demand, a property slump, overreliance on investment and exports, and the difficulty of pursuing deeper structural reforms. Given all of these challenges, U.S. uncertainty and higher tariffs on manufacturing and exports represent an added strain that Beijing would rather avoid. Its three-month relative tariff truce with Washington belies the continued underlying tensions and protracted challenges China anticipates in its relationship with America going forward.
Predictably, China has responded to U.S. actions by seeking to deepen trade ties elsewhere. Already the world’s largest trading nation – and the largest trading partner for most countries, including much of Latin America – it has many places to turn to as it works to continue diversifying its trade portfolio.
But China’s courting of other countries is not only defensive. Beijing also sees opportunity in Washington’s current “everywhere-all-at-once” approach to trade and foreign policy. Whatever one may think of Donald Trump’s methods, one thing that does appear certain is that he is serving as a historical accelerant: compelling almost every country, often reluctantly, to reassess its relationship with America and urgently consider new arrangements as a hedge against continued U.S. unpredictability.
In recent years, Beijing has tended to target canola or seafood in retaliatory trade actions.Chris Young/The Canadian........© The Globe and Mail
