Trade war a double-edged sword

A US-China trade war could be a double-edged sword for Canada.
It might be an overall negative but not an entirely bad thing, according to Canadian media.

China announced tariffs on Monday ranging between 15 and 25 percent on 128 American products, including pork, fruits, nuts and wine, in response to an estimated $3 billion in US tariffs on steel and aluminum.

Canadian local retailers said that lower US demand for Chinese-made goods could help Canadian retailers get better bargains on the Chinese market.
Retail Council of Canada vice-president Karl Littler said if US prices increase, it could help Canadian retailers by further easing cross-border shopping, even though a trade war would negatively impact the Canadian economy.

According to Littler, transnational retailers such as Costco, Best Buy and Walmart possibly may ship directly from Canada instead of transporting goods from the US to avoid tariffs.

About half a trillion dollars’ worth of goods from China — from toys to shoes to cellphones — enter the US every year. The prices of those products could rise due to tariffs.

Canadian Association of Importers and Exporters President Joy Nott also said the plan to raise the price of Chinese goods sold in the United States could prompt more Canadians to shop at home.

CIBC chief economist Avery Shenfeld told media that Canada could replace the US as a supplier to China if China imposes restrictions on US products.
Still, a lot of concern has been raised over the damage of a trade war.

Conference Board of Canada chief economist Craig Alexander said in an interview that since Canada is a nation that depends on exports of commodities, “a weaker Chinese economy would also hurt the Canadian economy by reducing sales and prices of raw materials”.

In agriculture, a sector that the Canadian economy also depends on, general manager of the Ontario Apple Growers Kelly Ciceran said the 15 percent tariff on fruit such as apples, cherries, peaches, raspberries and cranberries could lead to more US produce hitting Canadian stores.

Winery and Grower Alliance of Ontario CEO Aaron Dobbin also told media that more Canadian wine may be sold to China, but more US wine could also be shipped to Canada.

Yves Tiberghien, a distinguished fellow at the Asia Pacific Foundation of Canada, said there is a risk that the world’s trading system collapses if the situation escalates.

Contact the writer at renali@chinadailyusa.com