Prime Minister Mark Carney is currently attending the G20 summit in South Africa, which notably does not include the world’s largest economy. This exclusion is part of a trend initiated by U.S. President Donald Trump, signaling a significant shift in global dynamics.
As Canada seeks to broaden its international connections amid a less reliable relationship with the U.S., especially turning towards China, it must approach this pivot strategically. Prime Minister Carney has laid the groundwork for this shift, as evidenced by his recent meeting with Chinese President Xi Jinping during the Asia-Pacific Economic Cooperation summit in South Korea. Describing this encounter as “long overdue” and a “turning point,” Carney is setting ambitious goals, aiming to double Canada’s non-U.S. exports over the next decade.
Although Canada’s trade with China stands at $30 billion in 2024, making China its second-largest trading partner after the U.S., this figure only represents about five percent of Canada’s total exports. In contrast, approximately 75 percent of Canadian exports head south to the U.S. To diversify and expand trade with China, analysts suggest ending the trade war between the two nations, with discussions on removing Canada’s 100 percent tariff on Chinese electric vehicles currently underway.
Furthermore, experts highlight opportunities for collaboration beyond trade in goods, such as in research and development, manufacturing, and services. Given China’s technological advancements, there is potential for Canada to work alongside China rather than compete futilely. Building partnerships in sectors like electric vehicle battery production and AI could be beneficial for both countries.
Utilizing soft power, through avenues like education and tourism, can help foster new relationships with China. By embracing opportunities for aid in the Indo-Pacific region, Canada could fill the void left by the U.S. Agency for International Development’s closure, enhancing its soft power influence.
As Canada navigates its evolving relationship with China, analysts emphasize the importance of being vigilant, considering the differences in systems and addressing concerns such as human rights and cybersecurity. Developing a well-thought-out China strategy will be crucial in guiding Canada’s future interactions with the rising global power.