 Welcome to Mind Your Business ! Consider this your weekly guide to understanding what’s happening in the worlds of economics, business and finance. By Peter Armstrong
|  | Canadian Prime Minister Mark Carney is seen with Chinese President Xi Jinping in October of last year. (Adrian Wyld/Canadian Press) | | | Mark Carney is headed to China, where he's set to meet with President Xi Jingping. It will be the first visit to China by a Canadian prime minister since 2017.
There is some optimism heading into this meeting. The biggest issues on the table are China's restrictions on Canadian canola products and Canada's tariffs on Chinese electric vehicles.
Much of the attention through the trade wars of 2025 has been focused on aluminum and steel. But Canadian grain farmers have been some of the hardest hit.
China has imposed 100 per cent tariffs on canola oil and 76 per cent tariffs on canola seed.
That move came after Canada, in concert with the United States, slapped 100 per cent tariffs on Chinese EVs.
That has essentially closed off the biggest market grain growers have relied on.
I spoke with Scott Hepworth from his grain farm in Assiniboia, Sask., last week. He says there just aren't a lot of options for Canadian farmers right now.
"We're facing uncertainty with China, one of our largest importers of canola seed. We're facing uncertainty with the United States. Inflation has driven up our costs," he said.
Look at the export data for the last 11 years. You can see how China came to dominate canola exports. | | |  | | | | | That chart also shows just how steep the drop-off has been.
So farmers are on the edge of their seats watching Carney's trip to China.
As chair of the Grain Growers of Canada, Hepworth represents 75,000 grain farmers across the country. He says they're all hoping to see tariffs lifted entirely. But he also says they know that's probably not realistic.
Hepworth is hopeful something can be done to at least lower tariffs.
"Any relief at this time would be helpful. The market needs some certainty, plain and simple," he said.
Goldy Hyder, president and CEO of the Business Council of Canada, sees reasons to be hopeful. He says the meeting between Xi and Carney comes after what's being described as a "good meeting" at the Asia-Pacific Economic Co-operation in Korea.
At that meeting, Hyder says China proposed normalizing relations and that the government of Canada agreed that the relationship needed to be recalibrated.
"This meeting will focus on energy and agriculture primarily," Hyder told me in a text exchange. "I do expect Canada will be able to offer up more oil and gas that China desperately needs."
That need for energy products was heightened this week when the U.S. announced it was taking control of Venezuela's oil industry.
Until this month, Venezuela was shipping more than 800,000 barrels of oil a day to China. |  | | | Canada could increase oil exports via the Trans Mountain pipeline expansion to address China's energy needs.
The Chinese government has offered a path out of this tariffs mess before.
Back in October, the Chinese ambassador to Canada spoke with the CTV program Question Period.
“If Canada removes the unilateral unjustified tariffs on Chinese products, China will also reciprocate accordingly,” Wang Di said through a translator.
“If the EV tariffs are removed, then China will also remove the tariffs on the relevant products of Canada.”
Removing the EV tariffs doesn't seem likely, as pressure is being put on Carney from various corners. The Americans would be angered by such a move, but so would Ontario Premier Doug Ford.
Mexico approved a package of new tariffs against China last month. Tariffs of up to 50 per cent will be imposed on a whole suite of products.
The U.S. signalled its approval of those Mexican tariffs.
Is there a model there in which Canada would lower its 100 per cent tariffs on EVs to something closer to the Mexican rate, in return for some relief for grain farmers?
What do you think?
Email me at peterarmstrong@cbc.ca | | | Share this newsletter | | or subscribe if this was
forwarded to you. | | |  | | Prime Minister Mark Carney is headed to Beijing for a meeting with Chinese President Xi Jingping. The three-day meeting, focused on energy and agriculture products, will start on Tuesday. | | | | | | We will get a key snapshot of how the trade war is impacting Canadian businesses this week. The latest wholesale trade and manufacturing sales and orders data will be released on Wednesday. | | | | | | The latest U.S. inflation numbers are set to be released on Tuesday. The release will look at price growth in December. (Canada's inflation data will be released next week.) | | | | | Three things to read, watch and listen to this week | | |  | Adding Venezuela's oil industry gives Donald Trump a vast empire of petroleum exports. (Federico Parra/AFP) | | | 1. Donald Trump's oil empire | | | The Venezuela story is still very much a work in progress. There are a million hot takes on what happened and what it will mean for, well, just about everyone.
Getting that country's oil industry back up and running will require a colossal effort. That's not to say it's impossible. But restoring even some of Venezuela's export capacity will require many years and many billions of dollars.
But it does feel like something important has shifted.
I couldn't quite put my finger on precisely what that shift means. I used to have a boss who told me it's sometimes less important to have the right answers than it is to make sure you're asking the right questions.
This piece from Bloomberg asks some good questions. I'm not convinced the answers are correct. But it's a fascinating look at one potential implication of that shift.
The title reads: "Trump now has his very own oil empire."
The author, Javier Blas, is a columnist with Bloomberg Opinion and one of the smartest energy industry reporters in the world.
And here is the main thrust of the piece:
"Let’s do the math. Start with the oil production of the U.S. and add Canada. Then include Venezuela and the rest of Latin America, from Mexico to Argentina and everywhere else in between: Brazil, Guyana, Colombia. Like it or not, all of them are living under the 'Donroe Doctrine' — an increasingly belligerent Washington’s sphere of influence over the Americas. Together they account for nearly 40 per cent of the world’s oil output," wrote Blas.
Many Canadians will take issue with the inclusion of Canada on that list. But let's face it, some 97 per cent of this country's oil is (still) shipped to the U.S.
TMX has changed that calculation. About 64 per cent of the oil shipped through Trans Mountain last year went to China.
But Blas is right to say the overwhelming majority of Canadian oil is shipped to American refiners.
"Don’t give Trump all the credit, or even most of it. He’s in power at the right time. American oil would be booming without him thanks to the riches of U.S. shale, Canadian heavy oil and discoveries in places like Brazil and Guyana," he wrote.
The Venezuelan adventure only adds to the American oil empire. Blas leaves readers with this important idea.
"Over the years, we’ve learned to treat Trump pronouncements with caution. But in his second term, he’s done plenty of what he threatened to do. If he says the U.S. will be involved in Venezuelan oil, take him at his word. Perhaps the venture won’t be as grandiose, or as profitable, as he declares," he wrote. "That doesn’t mean it won’t happen."
Read Javier Blas's article here. | | | 2. Canada's to-do list for 2026 | | | I've ranted and raved about Amanda Lang's podcast Wonk in this space before, so I won't repeat myself (too much).
But this lookahead to what Canada needs to do this year is an absolute must listen.
Lang is CTV News’s chief financial correspondent and host of Taking Stock, BNN Bloomberg’s weekly business show. But Wonk is one of my favourite podcasts. She has a way of getting into the weeds on economic data or government policy that brings me right along with her.
In this episode, she interviews The Logic's editor at large, Kevin Carmichael, as well as Jean-Francois Perreault, the chief economist at Scotiabank.
Lang asks both guests what Canada needs to get done in this make-or-break year.
Carmichael has a great line that I think is going to stay with me all year. He says Canada is facing a "polycrisis," a series of issues that are screaming out for solutions.
"There are half a dozen things that we should be really worried about, and at any other moment in history might have been something we could really focus all our guns at. But they're all coming at us at once, and as far as I can tell, productivity growth is the answer or at least an answer to all of those things," he told Lang.
The entire episode is full of ideas just like that. I encourage you to listen to the episode rather than just read this synopsis, but let me add one more quote to entice you.
Perreault was talking about perceptions and how people inside Canada sometimes see this country differently than people outside it.
"The way Canadians think about the business climate in Canada has been pretty negative and it is still, I would argue, reasonably negative. But when you step outside Canada and you look at how foreigners think about the country, it's a very, very different read," he said.
Perreault says a whole series of polls and surveys all put Canada in the second or third spot in the world in terms of attractiveness for investment.
"And I think that's an interesting dimension to all this because, of course, as you all very well know, [Prime Minister] Carney is out there all the time talking to foreigners about how attractive a place it is to do business here. And I think foreigners are seeing that and will act on that in spite of how Canadians see themselves," he said.
I listen to a lot of podcasts, but I have a feeling I'll be carrying this one around with me for a while.
Check out the Wonk podcast here. | | | 3. Charts of the year | | | My favourite part of the New Year is going through the Globe and Mail's annual year in charts. Journalist Jason Kirby has quarterbacked the chart pack for years now and he's always finding new and interesting ways to use these charts to tell the story of the Canadian economy. This year's batch is just phenomenal. Kirby breaks them into groups looking at trade, markets, housing and politics, to name a few. I'll list a few favourites here, but do yourself a favour and check these out. They're chock-full of counterintuitive, smart, well-thought-out ideas about what's happening and where we are headed. Beata Caranci, chief economist at TD Bank, kicks off my Top 3 with a chart showing the change in who we are sending our exports to. "Canadian firms have recovered nearly $11-billion of the $18.5-billion loss to the United States. However, the nature of trade has shifted, leaving industries in the winner and loser column," wrote Caranci. Canadian businesses are finding new markets. It doesn't fill the hole left by the U.S., but it's (much) better than expected. Danielle Goldfarb, senior fellow at the Munk School of Global Affairs and Public Policy, wrote about the growth of digital services in the trade picture. "Despite tariffs on physical products dominating headlines, the fastest-growing imports in all regions of the world are digitally delivered services," she wrote. Her chart shows just how much more digital services have grown. But it shows something else too, "The chart shows that Canadian digital services trade has grown much more rapidly than goods and other commercial services, but it has now plateaued," wrote Goldfarb. She says to keep an eye on traditional trade in manufacturing, resources and services, but also whether Canadian firms are capturing the rapidly growing global demand for digital services. Lastly, Brett House, professor in the economics division at Columbia Business School, weighs in with something to watch for in balance-of-trade numbers. He says recent numbers showed a sharp narrowing of Canada's international trade surplus, but that in the years ahead, Canadians should welcome substantial trade deficits. Why should that measure matter to most Canadians, you may ask? Well, House has a good answer. "It’s an accounting truism that current account deficits get mirrored by net investment inflows in the capital and financial account – the 'balance' in a country’s balance of payments. November’s federal budget aims to unlock $1 trillion in new investment over the next five years," he wrote. In other words, the change from trade surplus to trade deficit could lead to more investment in Canada at the time we need it most. As I say, the whole package is awesome. Read the Globe and Mail's charts of the year here. | | | How the economy looks beyond Bay Street | | | Canadian jobs | | | I'm still using this space to look back at some of the bigger issues I flag as imminent and important.
Last week, we got the latest jobs numbers looking back at December.
Canadian employers added another 8,200 jobs last month. That marks four straight months of gains. Since the beginning of September, Canada has added nearly 190,000 jobs.
The unemployment rate ticked up slightly, but only because more people were looking for work. | | |  | The labour force expanded by 81,000 in December, which is the biggest jump in two years.
But zoom out and these numbers confirm what we've been seeing: that the Canadian economy is slowly (very slowly) starting to dig itself out of the hole it was in.
Economists weren't sure what to make of the massive swings we saw through the summer and fall. This report seems to have offered some reassurances.
"Suffice it to say that we had been deeply skeptical of the outsized employment gains in prior months, but the real shock had been the steep decline in the unemployment rate in the fall. Today's results largely address both of those questions, taking the jobless rate back up a bit above year-ago levels and shaving job gains to a more realistic pace," wrote BMO's chief economist Douglas Porter.
What do you think?
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