Beyond the Resource Curse? Canada and the Case for Bilateral Trade Agreements

Abstract

This article examines the case for Canadian trade bilateralism through the lens of the resource curse. As a favoured federal policy option for economic diversification, Canada’s bilateral trade agreements have underperformed even as energy exports continue to rise. Given Canada’s structural relationship to the global economy and the very low levels of diversification created by preferential trade agreements outside the NAFTA arrangement, there are few strong arguments for an intensification of Canadian bilateralism. However, the political reasons for bilateral trade agreements are better than the economic ones. Even though Canada's pattern of bilateral trade agreements to date does not suggest a coordinated attempt to unlock a specific region or strategic set of trading partners, a political stake in the current system pays dividends both in terms of diplomatic legitimacy as well as in the development of new templates for future agreements.