Friday, 10 August 2012

US Retailers Invade Canada: Why?

Big budget U.S. retail chains have big designs on Canada, causing some concern among traditional Canadian retailers.  With slow economic growth south of the border, Canada is an attractive place to set up shop.  With fewer retail outlets to shop and the traditional retailers making money, it makes sense to set up shop in Canada.  Parity with the U.S. dollar provides U.S. retailers a chance to be competitive.

For Canadian consumers this is a win-win situation, but not so much for the manufacturing industry.  Although the North American Free Trade Agreement (NAFTA) is often shunned by US politicians, there remains very little doubt that it has opened up markets north of the border for US companies.  When the original free trade agreement between Canada and the U.S. was negotiated and eventually ratified by both countries, it became part of an emotional debate in Canada.  Opponents to free trade were fearful that Canada was giving up its sovereign status.  Those in favour of free trade rejected the fears, arguing that it was the only way to move to a healthy market economy.  Full Story

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