Diversification is key for profits and survival
November 13th, 2008
Still in the Americas, but on her way back shortly, Kaila takes another stab at interpreting the Canadian business news on a grander scale…
I know I keep latching on to stories in the Canadian media for these blog posts, but honestly, they’re gold mines!
The other day, I read a fascinating article in the Globe and Mail’s Report on Business. I actually wrote out two pages of notes by hand (it’s that good) since I was reading the paper in a coffee shop and all I had was a notebook and pen, so imagine my frustration when I found the exact text of the article here.
According to reporter Gwyn Morgan, 75 percent of Canada’s trade is done with the US. It makes sense, I mean, they’re right there. He suggests, and I wholeheartedly agree, that Canadians need to reduce their dependence on the US and “exposure to the unpredictable winds of US trade policy.”
Morgan suggests a major diversification of Canada’s tradition relations, pointing to the EU as the world’s largest and richest market. Canada and the EU, he explains, share a rich history. Huge portions of Canadians are of European descent, and we share similar values to those in our ancestral motherlands.
He also points out that Canada and the EU are partners in global security, and that the EU is Canada’s 2nd largest trading partner and source of foreign investment, and the two regions will be shortly embarking upon free trade talks.
Canadian Prime Minister Stephen Harper shakes hands with French President and President of the EU, Nicolas Sarkozy.
Photo courtesy of Xinhua/Reuters
Hence implied is that the same applies in reverse – Canada would provide an excellent trading venue for EU countries for the same reasons.
This article provides an excellent example that can be applied to any country that is overly reliant on another for its trade. Diversification is key, and with the ease of diversifying via the internet, it makes sense.
Cheers! Kaila
