Better to Make Cellphones inChina


Why It’s


Why can’t we bring back all those factories that have gone offshore? In fact, why can’t


we source and manufacture everything here? The experts say it’s not a good idea


by Mary Teresa Bitti R


ENEGOTIATING, LET ALONE RIPPING UP, NAFTA was on no one’s radar when US President Trump made it the linchpin of a key point in his Make America Great Again campaign. Since winning office, he has consistently pushed the America


First, Buy American, Hire American agenda. In October, he took another swipe at free trade and globalization by threatening to “severely” penalize US companies that set up shop overseas. While President Trump speaks to (and stokes) Americans’


fears about lost jobs, it’s also true that some Canadians are just as frustrated with globalization. They see it as the reason manufacturers have left Canada for low-cost producers, leaving Canada to import products that could be made here. They aren’t wrong. If we look at the auto sectors in Canada, the


28 | CPA MAGAZINE | FEBRUARY/MARCH 2018


US and Mexico, nine of the last 10 auto assembly plants built in North America have been constructed in Mexico, with one going to the US. Canada did not benefit from those invest- ments — at least not directly. But does that mean we didn’t benefit at all? What would happen if we flipped the current reality and sourced and produced all the components of, say, a car and a cellphone, here in Canada? Would they be cheaper or so expensive few could afford them? Would we be better or worse off economically, both as a country and individually? Put simply, is globalization good? The answer is both yes and no and involves a look at an eco-


nomic theory called comparative advantage, which makes the case for international trade and globalization.


Stuart Kinlough/Ikon/Getty


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