Globalization: Good or Bad for Canada?

Globalization: Good or Bad for Canada?

Mr. Jaden Lairson

Anan Petprao

June 13, 2011

Economic

Globalization has changed us into a company that searches the world, not just to sell or to source, but to find intellectual capital – the world’s best talents and great ideas, (Jack Welch). With the flowing of the movement of people, idea, information, service and trade through the globe, these are factors that led to the interaction and integration among people across the globe culturally, socially, politically and economically. Globalization connects numerous countries, companies and people with one another which helps create stability; yet the phenomenon, globalization, also leans toward worldwide and global instability for a simple fact of the issue that one country or company will carry over the others. There are ongoing debates about globalization and how it affects people lives. Is it positive or negative? Many agree that it has a great capability to allow nations to strive economically, bringing riches through trade and increase the standards of living by interchanging ideas, knowledge and information to people around the world; however there are still many others who view globalization as the contribution to the corruption and exploitation of essential beliefs of issues such as human rights. Globalization has created a positive impact on Canada and the daily life of Canadian, it originates a desirable playing field for economic growth by limiting the amount of trade barriers and opening up competition in the free market, which allows greater foreign investment to creates more choice for consumers and increases the stature of capitalism in country. Globalization opens up the lines of international trade and free market, immigration allows Canada to become competitive which increases the economics’ growth and globalization allows greater exports of natural resources and foreign investments.

        Canada merchandise imports from China have increased significantly since the early 1990s. Developing countries such as Chile and Vietnam import grew at similar rate and remained fairly small as of 2006. In 2002-2006, China’s import shared doubled from 5.1 percent to 10.1 percent, which easily outstrip developed country such as Japan as the second country of origin of Canada’s import, (Isgut    Alberto). A sudden increase in import from China is not a phenomenon unique to Canada; this phenomenon is a result of the increasing use of offshore procurement of manufacturing goods by industrialized countries’ firms, it also reduces the opportunities of other countries’ firms to interact in Canadian economy with different variety and quality of goods and services. Before this Phenomenon, NAFTA which is a trilateral free trade deal that came into force in January 1994. The central trust of the agreement is to eliminate the large majority of tariffs on products traded among the U.S., Mexico and Canada (Teslik Hudson Lee). Corporate investment in Maquiladoras was expected to produce a Mexican middle class that would become a large market for U.S. goods, but it failed as skills and productivity lagged behind labour costs and jobs moved to China. Many famers were put out of businesses as Farm Bill subsidized U.S. agribusiness by as much as 40% of net farm income in 2002, plus when NAFTA removed tariffs, corn and other grains were exported to Mexico below cost which Mexican farmers could not complete with, (Amadeo Kimberly). As Farmers tried to catch up with U.S. agribusiness, chemical and fertilizers are used, causes high levels of pollution that would affect all three nations. In addition, the low environment standards in Mexico were also seen as a threat to the environment of Canada. Canada has experienced some losses in narrow sectors such as specialty steel production and processed food due to U.S. imports because NAFTA favours vast multi-companies, (i.e. auto) by increasing employments and profit and overpower those small companies. There is hidden concern that Canadian government cannot afford to look over, since NAFTA was signed, Canada seems to become too dependent on the U.S. as Canada’s source of economy. Now that U.S. is Canada’s largest trading partner; it is quite a concern because close relationship between the economy trades of two countries resembles a double edged sword. It is true that Canada’s economy will become stronger as U.S. rises, but there is chances of the opposite result occurring which could put Canada in difficult situation. There are many concerns over an issue of jobs loss due to NAFTA. Dennis Kucinich, U.S. representative of Ohio, states that NAFTA was written specifically to drive down wages because manufacture and corporation would seek other countries where wages are lower results in millions of people losing jobs. Other that economic issue that is a result from NAFTA, Hugh amounts of toxic waste is dumped into Canada because of weak environment law; this increases the risk of contaminating the drinking water in Canada. NAFTA gives away too many opportunities that many are taking advantages of its weak environment laws such as human rights and environment quality principle, it is causing a lot of damage to our society and environment that we cannot handle unless some aspects are changed within NAFTA for the better.