Canada Warns Of Trade Barriers

Anthony Fontanelle
January 23, 2008

The Canadian auto industry is on the verge of a breakdown after American automakers have cut down on production and employment in the country. The reason for this trend is the increasing value of the loony which means that automakers can no longer take bigger profits from importing vehicles into the United States from Canada.

The auto industry in Canada is also facing a threat from the influx of South Korean-made vehicles being exported in the country. What is more devastating for the Canadian auto industry is that the South Korean government does not allow Canada to sell vehicles in South Korea not manufactured in the said Asian country.

In response to this, Ontario Premier Dalton McGuinty said that he is prepared to take action against the entry of vehicles made in South Korea in Canada. The premier pointed out that the present situation is unfair and unless the Harper government takes any move to stop this, he will be forced to create a provincial barrier against Korean-made vehicles.

"We're saying what's good for the goose is good for the gander," said McGuinty in a recent interview. "If you want to send your cars over here, we need to send our cars over there," he added. This statement from the premier came after a caller asked over the phone what the province would do if Chinese vehicles start pouring into the Canadian auto market. The said caller said that the influx of Chinese vehicles in Canada would have the potential to give Chrysler a run for its money. This is potentially devastating for Canada's auto sector as Chrysler has the biggest auto assembly facilities in the country.

McGuinty said that he had urged Prime Minister Stephen Harper to protect the welfare of the auto industry by not signing a free trade agreement with South Korea if it does not entitle Canada to sell their vehicles in the said Asian country.

"In the event that the federal government unwisely enters into a free trade agreement that does not protect the interests of the auto sector here in Ontario and in Canada, we will have an obligation to look at what we can do from a provincial perspective to protect our industry," said McGuinty.

The provincial premier also pointed out that in 2006, the number of South Korean-made vehicles which entered the country amounted to about 114,000 units. On the other hand, for the same period of time, only a hundred units if automobiles made in Canada were shipped and sold in South Korea. This fact shows that the Canadian auto industry is being affected very much - not only the vehicle assembly plants but also manufacturers of auto parts such as brake hose Canada.

Source:  Amazines.com