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China will accept Canadian canola when the leadership feels like it, no sooner

Ron Walter writes about Canada's ongoing dispute with China
BizWorld_withRonWalter
Bizworld by Ron Walter

The federal government announcement of loan increases for canola farmers facing lost markets from Chinese bully boy tactics does little to help matters.

Aside from the dubious wisdom of farmers taking on more debt when prices for commodities are sliding, many farmers have little need for the loans.

What the feds did is window dressing to create the appearance of taking action now.

Producers are rightfully outraged. Saskatchewan Premier Scott Moe is outraged but some of his outrage appears to be political posturing for rural supporters.

If Moe really wanted to send China a message, he could send home the thousands of Chinese university students or triple their tuition fees. Instead, he and others want the federal Liberals to get tough with China.

This trade issue is no David and Goliath story; Canada has no slingshot or magic stone to slay the Chinese.

Canada sits in a small rowboat on treacherous trade war waters, caught between two warring bully ships coming at us from both sides firing shots at each other and throwing “friendly fire” our way.

Sadly, this country has few options, other than pursuing the science angle and hopefully convincing the Chinese to accept Canadian canola shipments.

China had a good crop and needs less canola, allowing that nation to penalize Canada for complying with a United States treaty by arresting a Chinese telecom executive, who happens to have connections with Chinese leadership.

The whole American rant against this telecom outfit seems to be part of trade war bullying to ensure America stays ahead in the technology race.

Action under World Trade Organization trade rules is an option, but these cases and rulings usually take a year or two to complete. With China there is no guarantee of compliance or another round of appeals is possible.

China will accept Canadian canola when it feels like it. Release of the telecom executive under house arrest, or a Canadian court ruling that she won’t be sent to the U.S. for trial, should solve the matter.

If she is sent for trial to the U.S. look for more and continued retaliation from China.

Canadian farmers have sustained similar political fake scientific export blocks before — flax, canary seed and peas.

Generally, these disputes have been solved within a year or two: the solution often being a poor crop in the country with trade restrictions.

As a trading nation Canada has purred along the waters nicely, supported by international trade rules and co-operation.

The declaration of a trade war by United States President Donald Trump made the ride bumpier.

No doubt, the Chinese, known for past bully tactics, were emboldened by the Trump trade actions. The Chinese target hurt Canada and Australia, which also is dealing with Chinese sanctions.

We are caught between two giant bullies, each capable of inflicting devastating economic harm on us.

Canadians are productive, producing much more than we need; obtaining between 30 per cent and 40 per cent of our national income annually from exports to other countries.

If the trade wars continue long enough Canada may be forced to re-think and re-examine the export business model.

Ron Walter can be reached at ronjoy@sasktel.net

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