Introduction
The countries of Canada and the United States are the two main countries located in Northern America. The two countries boast mutual benefiting economies, friendly alliance-based relationships as well as collateral trade unions, and friendly immigrant regulation to sustain their international relations. The truth behind the story however is that Canada despite being an independent international state is highly dependent on the United States for economic as well as other forms of support. This dependence on another nation, the likes of the United States has sparked agitation and aggravation in the citizens of Canada who want to be seen as independent citizens. The following discusses the level of dependency of Canada on the United States and how this issue is affecting the two countries.
Background of the Issue
The background of the issue regarding the dependency of Canada on the United States is mostly based on the limited resources and capital available to the country as well as its climatic conditions and location.
While the country of Canada is one of the largest countries in the Northern Hemisphere with a surface area of 9,984,670 square kilometers Canada has a population of 33,429,000 as of 2008 only which makes the population density per square kilometer to 3.2 persons. This makes the human resource available to the country very limited for the operation of the business, trade, and the running of the country based on its size and location. Much of the land is uninhabitable by humans due to massive tundra and wastelands. As a result, Canada is highly dependent on outside countries for the inflow of working immigrants as well as in the United States for the inflow of intellectual capital into the country. However it has also been noticed that the intellectual capital of Canada tends to drain to the United States on the completion of the projects and assignments.
The United States is the main customer and trading partner of Canada. Canada trades with the US worth $1.3 billion daily. This makes the country very much susceptible to the economic market condition and market stability of the United States for the positive balance of payments position. “Canada’s economy is growing steadily stronger and business conditions are more favorable than they have been in years. But Canada’s dependency on the US, which consumes almost 86 percent of total Canadian exports, means that Canada’s newfound economic success could come to an abrupt halt as the US economy slows. Two factors – ongoing Canadian government reforms and growth in Canada’s Internet economy–could soften the blow to Canada as the US economy sinks.” (Hansen, 2001) As a result, while it may seem that Canada is an independent country with a growing economy & GDP, the country is only sustaining and deriving its economic position and high levels of GDP on the performance of the US economy. This trend has been increasing since 1995 as since then the export-based GDP contribution of Canada derived from the trade with the United States has increased from 77.5 in 1995 to 85.8 by 2000. This depicts that a fall in the exports by Canada to the United States can cause a deficit in the balance of payments for the country.
The education system in Canada along with the health care and social security system is also based on that designed by the United States for itself. The similarity of the two countries in terms of their population characteristics, their proximity, and their bilateral relations have sparked sharing of intellectual intelligence in terms of education, healthcare, and business; however, all of this is mostly based on the structures and models developed by the United States.
Another issue that influences the dependence of Canada on the United States is the political and influential position that the US has in the world amongst other countries. Right now the United States is a superpower and by being highly dependent on the country, Canada can absorb some of the benefits that are attained by the United States amongst the global international community in terms of international relations.
Extent Implications of the Issue
The high level of dependency of Canada on the United States has sparked other internal issues amongst the population and the business community in Canada. The powerful position that the United States enjoys as the major customer of the exports by Canada allows US-based businesses to take advantage of their Canadian business associates and suppliers. This is evident by how they tend to influence the logistics of the trade to provide the goods and services in the United States instead of arranging for their logistics and shipping operations (Bradley, 2003). Aside from this the business based in the United States also tends to employ monopolistic strategies when ordering high-quality products and services from Canada at much cheaper rates and prices. Canadian businesses are forced to comply due to the high percentage of their sales being ordered by businesses & customers in Canada.. As a result of the trade agreements between the two countries, US-based businesses can have a stake in the Canadian businesses which has resulted in increased unpopularity of the US in Canadian citizens.
Economic nationalism is on the rise in Canada due to the agitation and frustration of Canadian businessmen over their US-based associates and customers. The people in Canada are increasingly becoming not in the favour of strong bilateral relations of Canada with the United States. The anti-American sentiment in the country is growing influenced by the highlighted economic as well as the social and political factors. The political image of the United States is not very strong in the world in the face of the recent wars waged by the nation in the name of the War on Terror. Canada is a peace-loving and promoting nation that believes in solving issues through negotiations & dialogue. The aggravated stance was taken by the US on the matter however is not favored by the Canadians.
The result of the increasing tension on the ground level between the two countries depicts that a revolt on an economic, political, and social level can take place which would openly declare for independence from the United States in terms of the economy as well as law and regulation of the country.
Other Positions
The complementary position regarding the issue can be seen in the growing anti-American sentiment in the political figures of Canada as well as the local public. The Western states of Canada which come under French Canada have put wheels into motion to separate their policies, their actions, and their rules and regulations as well as trade agreements from the US as well as the western states of Canada. Radicalism in these states is seeking to declare independence from the western Canadian states as well as the United States of America.
Contrary to the issue however the history of the United States and Canada depicts that the relations between the two countries are very strong and that Canada does tend to rely on the United States of America a lot while supporting its ideologies and actions. In terms of the economy, both the countries are highly dependent on each other for trade, especially with the US now relying on Canada for fossil fuel and oil resources and people think that this dependence of both the countries cannot be done away with.
Solutions
There are ways and strategies available to the Canadian government as well as the corporate industry to become less independent of the United States both in terms of politics and the economy. However, it needs to be realized that complete independence is not possible while a dramatic change in a short period is also not realistic or feasible. Gradually by employing these strategies Canada can increase its independence from the United States.
The Canadian government can establish deep-rooted international relations based on trade agreements and oil exports with the Pacific Asian, African, and European countries. The Asian countries are developing nations that can support the economy of Canada by becoming long-term prospective customers. The established relationship with the European nations and the EU can provide the country with the needed political independence and power from the United States. Moreover, it can also develop immigration policies with these countries to promote an inflow of intellectual capital and human resource into the country.
The internet and information technology can also play a major role in forming the economic independence of Canada. Businesses and corporations can increase their presence online and invest in operations on the internet to directly contact and communicate with their global customers. This can increase the market available to the businesses in Canada as well as make them less reliant on US-based businesses and associates. “The continued growth and solvency of Canadian firms will depend on Canada’s ability to steer a course that reduces Canadian dependency on the US economy, takes a more aggressive approach to IT investment and Internet growth, and consolidates the reforms geared to lower the tax burden and reduce debt. Until then, credit managers should closely monitor the impact of the US slowdown on Canadian firms, with careful attention to the companies and sectors that are most dependent on US sales.” (Hansen, 2001).
Conclusion
There is growing anti-American sentiment amongst the Canadians who are trying to make Canada economically and politically independent from the United States. However, it needs to be established that independence from the US cannot be achieved overnight. By investing in information technology, GSM, and wireless satellite communication as well as international relations with European and Pacific Asian countries, Canada can strive to be independent of the United States of America.
References
Hansen, F., ‘Canada Weathers the Slowdown’, Business Credit, 2001, Vol. 103 Issue 4, p46, 4p, 4 charts, 4 graphs. 2008. Web.
Gibson, J. D., ‘Canada’s declaration of less dependence’, Harvard Business Review, 1973, Vol. 51 Issue 5, p69-79, 11p, 2008. Web.
Bradley, D., ‘Fixing the border: Why shippers must meet their carriers halfway on the FAST program’, Canadian Transportation & Logistics, 2003, Vol. 106 Issue 8, p24-25, 2p, 1 color. 2008. Web.
Thompson, J.H., Randall, S.J., Canada and the United States: Ambivalent Allies, University of Georgia Press, 2002.
Presto, R.A., ‘Military Dependence And Political Independence: The Case Of Canada’, 2008. Web.
Copeland, D., ‘Diversifying Canada’s Dependence: Look East, Asian Perspective’, 2003, Vol. 27, No. 4, pp277-293, 2008. Web.