Bank of Canada Governor Tiff Macklem says Canada must seize opportunities to secure its place in the changing global trading landscape.
In a speech Tuesday to the Canada-UK Chamber of Commerce in London, Macklem argued that international trade is being rethought.
“We must be effective at the international table to influence how trade is reshaped and reoriented,” he argued, according to the full text of his speech.
Mr. Macklem said Canada needs to invest in trade infrastructure and reduce trade barriers because transforming supply chains presents risks, but also opportunities, for Canadian businesses.
He said Canada needs to invest in its electricity grid and transportation infrastructure, while businesses need to invest in new equipment and innovation to be competitive globally.
The central bank governor noted that international trade has slowed and that current growth is increasingly coming from services, not goods.
We need to build better relationships, make the products people want to buy, build and maintain the infrastructure needed to get those products to market, and increase our productivity to compete globally.
Bank of Canada Governor Tiff Macklem
Mr. Macklem recalled that the Bank of Canada does not define trade policy, but that it must understand the transformations of international trade, since they have an impact on costs and inflation.
“Looking ahead, given the slowdown in globalization, the cost of goods globally may not decline to the same extent. All else being equal, this could add to the upward pressure on inflation,” he warned.
Last week, the Bank of Canada cut its key interest rate by a quarter of a percentage point to 4.25%.