Toronto, Ontario, August 22, 2023 – In an interview with Steve Zhao of Canada & World Report, Federal Capital Group, a Canadian company established for over five years (OCN 2623515), announced on August 22 that it will provide financial guarantee services to Canadian importers of Chinese goods in need of funding. This initiative aims to reduce the financing costs of Canadian importers and further promote the development of trade between Canada and China.
According to the latest survey by the Angus Reid Institute, in 2020, Canada exported goods worth $25 billion and imported goods worth $77 billion from China, making China Canada's second-largest trading partner.
Canada heavily relies on international trade. In 2018, trade accounted for 66% of Canada's Gross Domestic Product (GDP), a metric used to measure the significance of international trade on the domestic economy. Among G7 economies, only Germany ranked higher at 66%, surpassing Australia (43%) and New Zealand (56%). China is Canada's largest trading partner after the United States and the European Union. While Canada's bilateral relationship with China has sometimes been tied to political disputes, such as the trade disputes involving canola, pork, and beef in 2018 due to strained bilateral relations, the core of Canada-China trade has been growth. From 2011 to 2020, Canada's exports to China increased by 50%, whereas exports to all other countries grew by only 16%.
Canada's trade with China, both exports and imports, has seen overwhelming growth over the past three decades. Despite recent political tensions and the negative impact of the global COVID-19 pandemic, Canada's exports to China still saw a 7% increase in 2020. While this followed a significant decline the previous year (-16%, primarily due to a drop in agricultural exports), it underscores the resilience of the broader trade relationship between the two nations. In comparison, Canada's goods exports to China accounted for 4.8% of its total exports in 2020, while exports to India represented only 0.7%.
In 2021, Canada's exports to China saw a 14% YoY growth, the fastest since the 17.29% growth recorded in 2018. Furthermore, the total value of Canada's exports to China exceeded the record set in 2018 ($27.69 billion). In 2022, imports from China increased by 16.36% compared to 2021. The primary imported goods included consumer products ($31 billion CAD) and electronic/electric equipment ($28 billion CAD). In 2022, the total value of imported goods from China surpassed $100 billion CAD for the first time, reaching $100.3 billion CAD. Canada's exports to China also rebounded, reaching a record high of $27.9 billion CAD in 2022. China lifted the ban on Canadian canola oil implemented during the Meng Wanzhou extradition case.
Economic analysts suggest that bilateral trade is growing due to increased demand and the normalization of supply chains, with businesses showing less concern about political conflicts between the two nations.
Anastasia Ufimtseva, Project Manager at the Asia Pacific Foundation of Canada, believes that while economic and political aspects are closely linked, achieving alignment takes time. Businesses tend to follow global economic trends and seek profits.
Canada's trade with China encompasses both goods and services. China, being the world's factory, is a critical supplier of goods for Canadian companies and consumers. Canada imports a wide range of items from China, including phones, electronics, children's toys, masks, and Personal Protective Equipment (PPE). Conversely, China is a significant buyer of Canadian products such as canola, pork, coal, iron ore, and other major exports. While service trade with China is smaller in scale than goods trade, it remains an essential aspect of Canada-China economic relations. In recent years, the influx of Chinese tourists and students to Canada and the expansion of Canadian financial institutions in China have driven substantial growth in Canada-China service trade.
Andrew Wang, Chairman of Federal Capital Group, expresses optimism about the future of Canada-China trade. He notes that Federal Capital Group and its affiliated company, PlusWee Inc. (OCN 5046580), are dedicated to cross-border trade in both countries, leveraging human resources, physical assets, and policy advantages to serve trade enterprises.
PlusWee Inc. specializes in promoting and selling Canadian and American products in the Chinese market. Collaborating with Chinese cross-border e-commerce companies authorized for overseas direct mail operations by Chinese customs, PlusWee Inc. assists Canadian and American suppliers in selling products to mainland China. With a focus on channel development, operational management, customer service, and providing comprehensive e-commerce solutions to mainland Chinese users, PlusWee Inc. aims to facilitate e-commerce growth.
Andrew Wang emphasizes that providing "quick, accurate, and low-interest rate loan services to Canadian businesses engaged in Canada-China trade" is a core focus of Federal Capital Group. Notably, Federal Capital Group is currently the only company in Canada engaged in cross-border lending. This business addresses fundamental pain points for Canadian and Chinese traders and accelerates the development of cross-border trade chains. Leveraging its resources and capital channels, Federal Capital Group, in partnership with PlusWee Inc., aims to drive and support trade between Canada and China.
Andrew Wang highlights, "This platform can generate numerous new financial models, providing substantial assistance to businesses engaged in Canada-China economic exchanges." Unlike traditional financial lending methods, local Canadian guarantee companies can provide deeper insights into Canadian purchasing parties. They can endorse cross-border supply chain finance transactions between Canada and China, instilling confidence and credibility in all parties involved. Federal Capital Group's guarantees for Canadian importers of Chinese goods involve seven steps: 1. Submit basic information of the Canadian importing company and obtain an approved limit; 2. Sign a cross-border supply chain guarantee financing agreement; 3. Sign a trade contract with a Chinese trade agency platform company; 4. The special fund lends to Chinese suppliers; 5. Conduct trade operations, with goods entering a designated Canadian local warehouse; 6. Meet delivery conditions as per the agreement, and release the goods; 7. At the end of the financing term, return funds to the Chinese trade agency platform in accordance with the trade contract.
Canadian importers of goods from China in need of financing and loans can contact Federal Capital Group through PlusWee Inc. (https://www.pluswee.com).
Source: Story.KISSPR.com
Release ID: 712972
