Ottawa is going all in on 'friendshoring.' Here's what that could mean.
CTV
This year's budget reveals the federal Liberals envision Canada relying more on its allies for trade in the future, economists and geopolitical experts say -- even if that could result in higher prices or missed opportunities.
This year's budget reveals the federal Liberals envision Canada relying more on its allies for trade in the future, economists and geopolitical experts say -- even if that could result in higher prices or missed opportunities.
"It's a reframing," University of British Columbia professor Vina Nadjibulla said after the budget's release this week. "It's essentially saying what we've been doing for the last 30 years of engagement is over."
U.S. Treasury Secretary Janet Yellen coined the term "friendshoring" a year ago, saying allies should rely on each other to make supply chains more resilient, and defang hostile actors from taxing or withholding goods.
The Liberals have sent mixed messages in the past year on the extent to which they agree with that approach. Last October, Industry Minister Francois-Philippe Champagne said Canada was "decoupling" from China, but days later Foreign Affairs Minister Melanie Joly said she wanted to "re-establish ties" with Beijing.
The language in the federal budget paints a clearer picture. But some experts warn that the us-versus-them language means Canadian businesses will need to adjust in order to avoid losing out on opportunities with the developing world.
Nadjibulla, speaking at a Wednesday panel held by the Canadian Global Affairs Institute in Ottawa, said Tuesday's budget contains the government's clearest articulation yet of where the world is now.
"The language there is that it is a more dangerous world and a more competitive world. And in that world, Canada needs to deepen its connections with its allies," she said.
