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Last month, echoing a U.S. announcement three months earlier, the federal Liberals announced a 100 per cent tariff on the import of Chinese electric vehicles (EVs). China wasted no time striking back where it would hurt most, launching an anti-dumping investigation into Canadian canola exports. While there’s no evidence of dumping, there’s a very high likelihood the move is a procedural pretext to halting canola imports. China has long been the biggest canola buyer and was expected to purchase 70 per cent of this year’s bumper crop.
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China’s move was predictable, given that it blocked canola imports following the arrest of Huawei Chief Financial Officer Meng Wanzhou in 2019. Canola producers in Alberta, Saskatchewan and Manitoba lost some $2 billion as a result of that boycott.
The Trudeau government’s press release described Chinese EVs as an “extraordinary threat” to Canada’s auto workers. But the reality is that Canada produces zero EVs, and there are no projects on the table to do so. What is on the table are subsidies — $50-billion worth — to Honda, Swedish automaker Northvolt, Ford, Stellantis, Volkswagen and General Motors to build EV battery plants in Ontario and Quebec.
The American situation is entirely different from Canada’s. The U.S. does manufacture EVs, but the U.S./China trading relationship involves multiple industries with no obvious target for China to strike back at. This makes Trudeau’s mimicking of the American move profoundly irresponsible. That the Liberal government would put canola farmers at risk in order to protect jobs in Ontario and Quebec is despicable but hardly out of character. The Trudeau Liberals have a long record of making decisions that harm the West — and western farmers, in particular.
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Data from the Agricultural Carbon Alliance show that during just one month in 2023, livestock farmers paid an average $726 in carbon taxes, field crop farmers $2,024 and greenhouse operators $17,173. A sampling of 50 farms showed total payments of $329,644 in just that one month. And there are 190,000 farms in Canada.
This harmful policy comes at a time when the future of the entire Canadian farming sector is at risk. A study sponsored by the Royal Bank of Canada predicts that by 2033, 40 per cent of Canadian farm operators will retire. Over that same period, a shortfall of 24,000 general farm, nursery and greenhouse workers is expected. The study states: “These gaps loom at a time when Canada’s agricultural workforce needs to evolve to include skills like data analytics. To meet our long-term goals, we’ll need to build a new pipeline of domestic operators and workers.”
Even worse, the future of those battery plants the Liberals have handed $50 billion in subsidies to is in serious jeopardy. As Forbes reports, “Fully-electric passenger vehicle demand is softening. Unsold inventories have been clogging dealer’s lots. Manufacturers — from the biggest brands to the smallest startups — are cutting back production and investment plans.”
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How does the future of Canadian EV manufacturing relate to the future of farming? The answer is that the first cannot exist without gigantic taxpayer subsidies, while what farmers need is to be relieved of debilitating carbon taxes. We should not be robbing farmers to pay subsidies to battery-makers.
What we should be doing is encouraging young people to enter farming and provide them with the skills needed to “build that new pipeline” of agricultural workers. A country that can’t fuel and feed itself is a vulnerable country. We Canadians are fortunate to have the resources to do both and also to create wealth by exporting those resources. But we have every reason to be outraged by a government that spends billions of dollars subsidizing an industry where our country has no economic advantage while imposing heavy taxes on an industry that is absolutely vital to thousands of rural communities and to the food security of all of us.
Gwyn Morgan is a retired business leader who has been a director of five global corporations.
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