If Canada’s economy is to really thrive on a global stage, here is a big, bold idea: the country should prioritize efforts on deepening ties with Latin America.
In this rocky economic and political climate, the whole world is bolstering ties within their own home regions -- Africans are increasingly trading with each other, so are Asians and Latin Americans. That leaves Canada a little adrift -- three-quarters of its trade is still with its chief trading partner, the United States, which is set for a prolonged period of modest growth. Efforts to diversify beyond that have been slow.
Given that, “what we need to do is to begin to consider the Americas as our home region,” says Guillermo Rishchynski, Canada's ambassador and permanent representative of Canada to the United Nations.
We should still engage with Africa, Europe and Asia, he adds. But it’s time to “integrate ourselves even further with the Americas and with the future of the Americas.”
That means, in a sense, returning to our roots -- Canada has been involved in Latin America since the late 19th century. “In the 1890s, it was Canadian banks that administered the customs in the ports of Cartagena and Barranquilla in Colombia, it was Canadians that brought hydroelectricity to Rio and Sao Paulo in Brazil. Less known, is that Canadian capital and engineering also brought hydroelectricity to Mexico,” Mr. Rishchynski told an Economic Club forum on Wednesday.
“The reality is that the Americas today is hugely important to us, and our economic well being going forward.”
Some of the reasons for deeper engagement with Latin America are familiar: it has a younger population than us, and its growth prospects are far better. Many countries, such as Brazil, have turned from net debtor to creditor nations. Their clout will only growth in the coming years.
But there are pragmatic reasons for focusing to the south as well -- namely, proximity. Bogota is just a five-hour flight from Toronto, and Halifax is in the same time zone as Rio. In an era of rising transport costs and need for speed and efficiency, proximity matters more than ever.
The potential might be there, but actual forays into the region are still rare. Fewer than 500 Canadian companies are present in Brazil, and just 2,600 companies are in Mexico, Mr. Rishchynski points out (for context, Canada is home to more than a million companies).
Last year, just 1.5 per cent of Canadian exports went to South America and the region comprised just 3.4 per cent of imports, according to Statistics Canada.