As supply chain woes continue to add to the rising cost of living, concern over how China’s zero-COVID policy may further add to it is on the rise, especially the impact it might have on Canada.
Beijing’s tough COVID-19 rules and factory shutdowns can wreak havoc on supply chains that Canada relies on. Now, with China easing its zero-COVID policy, the virus has surged, creating an environment for new variants to thrive and uncertainty for the global economy, including Canada, according to some experts.
Ari Van Assche, a professor at the department of International Business from HEC Montreal, thinks that China’s move to drop COVID rules has created a lot of uncertainty that could definitely “put a big drag” on the world economy.
“It’s very difficult to understand what is happening in China because data on supply chain issues or on the spread of COVID in China is not very reliable,” Van Assche told Global News.
On Jan. 4, World Health Organization (WHO) expressed concerns about the lack of outbreak data from China, accusing China of not giving an accurate picture of the situation there and underrepresenting the number of hospitalizations and deaths from the virus.
The question of whether or not the zero-COVID policy would influence supply chains “depends very much” on where China wants to go, said Van Assche.
“If China is able to move on and ensure that we’re going back to normal, despite the (lack of) clarity that we have right now … then 2023 might be a fantastic year of breaking out of collapse,” said Van Assche.
“But if it leads to significant disruptions in an economy that already is trying to catch its breath to get to normal, it’s not really clear what’s in store for 2023, or what 2024 will look like.”
Supply chains have gone haywire ever since the World Health Organization declared COVID-19 to be a pandemic in March 2020. Shipping containers were diverted to medical supplies or held unused in far-flung ports. And in the resulting chaos, Canadians saw compound effects: a semiconductor shortage, a dearth of rental cars, a rise in lumber prices.
The trend somewhat balanced through most of 2022, with global supply chain pressures increasing moderately in November, continuing a drift seen in October, albeit at a lower rate.
Delayed shipments from China was the largest factor contributing to the rise in supply chain pressures last year, according to a Global Supply Chain Pressure Index report.
China’s National Bureau of Statistics stated on Dec. 31, 2022, that factory activity had shrunk for three months leading to December as the country dropped its zero-COVID policy.
According to Werner Antweiler, an associate professor at the University of British Columbia Sauder School of Business, China’s factory model has made the country and its workers vulnerable to COVID-19 outbreaks.
“In general, China’s concentration of manufacturing in a number of ‘campuses’ in places like Shenzhen, such as Foxconn’s Longhua Science and Technology Park, makes it vulnerable to significant new COVID outbreaks,” Antweiler told Global News in an email.
The outbreaks could “have an outsized effect with respect to disrupting global supply chains,” said Antweiler. “It is possible that China may need to revert to localized lockdowns in the absence of good alternatives.”
Is Canada prepared to deal with supply chain snarls?
Van Assche says he believes there will be some supply chain disruptions, but it will not be on the same scale as Canada has seen in the past, as companies are slowly adapting to the new reality.
“It will likely have an impact on a lot of companies individually, but it won’t be of the same level that we’ve seen during the perfect storm of supply chain disruptions during the pandemic,” said Van Assche. He noted that the demand for goods coming from China has also eased up with Canadian consumers opting to buy less Chinese goods.
“The severe stress on the global shipping industry has been going down, so is not as difficult as it was in the past for companies to find space on containers now,” said Van Assche.
Van Assche says the Canadian government needs to identify what goods are essential to the public and come up with strategies to build a secure supply chain.
0:24 Canadian transport minister announces steps to ease export
In an email to Global News, a spokesperson for Innovation, Science, and Economic Development Canada said that the government is monitoring signs of strain in critical supply chains and infrastructure to “ensure the timely movement of goods and materials as the economy recovers.”
It said that past experiences have “demonstrated the urgency and necessity to diversify our supply and trade bases, embrace digital technologies, move away from linear supply chain networks, and build domestic manufacturing capacity in critical inputs and products.”
There can be various causes behind supply chain disruptions, and factors impacting shortages are often exclusive to a commodity or industrial sector, the innovation agency noted.
“Common elements affecting multiple supply chain disruptions, however, are the same for Canada as with other nations around the world – enormous shifts in demand, transportation issues and container shortages, and exacerbated shortages in skilled labour.”
“To enhance supply chain security in specific commodities such as critical minerals, batteries and semiconductors as well as other inputs that are important to support critical sectors like life sciences, manufacturing, transportation, and defence,” the Canadian government is working closely with international partners, they said.
Transport Canada also said they have been working closely with manufacturing industries and other supply chain partners to ease congestion. They implemented the Supply Chain Task Force in 2022 and continue to support investments in transportation infrastructure projects.
In an email to Global News, the agency said that the government “continues to engage with industry and other supply chain partners on any impacts to the fluidity and reliability of the system.”
Further, the National Trade Corridors Fund (NTCF) is helping ease “bottlenecks and congestion in Canada’s transportation system,” they added, while also “enhancing trade hubs and gateways so it is easier for Canadian businesses to get their goods to consumers around the world.”
“The Government of Canada remains committed to bringing forward a National Supply Chain Strategy, with further details to be announced in Budget 2023,” they said.
CALGARY – MEG Energy says it earned $167 million in its third quarter, down from $249 million during the same quarter last year.
The company says revenues for the quarter were $1.27 billion, down from $1.44 billion during the third quarter of 2023.
Diluted earnings per share were 62 cents, down from 86 cents a year earlier.
MEG Energy says it successfully completed its debt reduction strategy, reducing its net debt to US$478 million by the end of September, down from US$634 million during the prior quarter.
President and CEO Darlene Gates said moving forward all the company’s free cash flow will be returned to shareholders through expanded share buybacks and a quarterly base dividend.
The company says its capital expenditures for the quarter increased to $141 million from $83 million a year earlier, mainly due to higher planned field development activity, as well as moderate capacity growth projects.
This report by The Canadian Press was first published Nov. 5, 2024.
Premier David Eby is proposing an all-party committee investigate mistakes made during the British Columbia election vote tally, including an uncounted ballot box and unreported votes in three-quarters of the province’s 93 ridings.
The proposal comes after B.C.’s chief electoral officer blamed extreme weather, long working hours and a new voting system for human errors behind the mistakes in last month’s count, though none were large enough to change the initial results.
Anton Boegman says the agency is already investigating the mistakes to “identify key lessons learned” to improve training, change processes or make recommendations for legislative change.
He says the uncounted ballot box containing about 861 votes in Prince George-Mackenzie was never lost, and was always securely in the custody of election officials.
Boegman says a failure in five districts to properly report a small number of out-of-district votes, meanwhile, rippled through to the counts in 69 ridings.
Eby says the NDP will propose that a committee examine the systems used and steps taken by Elections BC, then recommend improvements in future elections.
“I look forward to working with all MLAs to uphold our shared commitment to free and fair elections, the foundation of our democracy,” he said in a statement Tuesday, after a news conference by Boegman.
Boegman said if an independent review does occur, “Elections BC will, of course, fully participate in that process.”
He said the mistakes came to light when a “discrepancy” of 14 votes was noticed in the riding of Surrey-Guildford, spurring a review that increased the number of unreported votes there to 28.
Surrey-Guildford was the closest race in the election and the NDP victory there gave Eby a one-seat majority. The discovery reduced the NDP’s victory margin from 27 to 21, pending the outcome of a judicial review that was previously triggered because the race was so close.
The mistakes in Surrey-Guildford resulted in a provincewide audit that found the other errors, Boegman said.
“These mistakes were a result of human error. Our elections rely on the work of over 17,000 election officials from communities across the province,” he said.
“Election officials were working 14 hours or more on voting days and on final voting day in particular faced extremely challenging weather conditions in many parts of the province.
“These conditions likely contributed to these mistakes,” he said.
B.C.’s “vote anywhere” model also played a role in the errors, said Boegman, who said he had issued an order to correct the results in the affected ridings.
Boegman said the uncounted Prince George-Mackenzie ballot box was used on the first day of advance voting. Election officials later discovered a vote hadn’t been tabulated, so they retabulated the ballots but mistakenly omitted the box of first-day votes, only including ballots from the second day.
Boegman said the issues discovered in the provincewide audit will be “fully documented” in his report to the legislature on the provincial election, the first held using electronic tabulators.
He said he was confident election officials found all “anomalies.”
B.C. Conservative Party Leader John Rustad had said on Monday that the errors were “an unprecedented failure by the very institution responsible for ensuring the fairness and accuracy of our elections.”
Rustad said he was not disputing the outcomes as judicial recounts continue, but said “it’s clear that mistakes like these severely undermine public trust in our electoral process.”
Rustad called for an “independent review” to make sure the errors never happen again.
Boegman, who said the election required fewer than half the number of workers under the old paper-based system, said results for the election would be returned in 90 of the province’s 93 ridings on Tuesday.
Full judicial recounts will be held in Surrey-Guildford and Kelowna-Centre, while a partial recount of the uncounted box will take place in Prince George-Mackenzie.
Boegman said out-of-district voting had been a part of B.C.’s elections for many decades, and explained how thousands of voters utilized the province’s vote-by-phone system, calling it a “very secure model” for people with disabilities.
“I think this is a unique and very important part of our elections, providing accessibility to British Columbians,” he said. “They have unparalleled access to the ballot box that is not found in other jurisdictions in Canada.”
This report by The Canadian Press was first published Nov. 5, 2024.
WINNIPEG – A public memorial honouring former judge, senator and chair of the Truth and Reconciliation Commission into residential schools, Murray Sinclair, is set to take place in Winnipeg on Sunday.
The event, which is being organized by the federal and Manitoba governments, will be at Canada Life Centre, home of the NHL’s Winnipeg Jets.
Sinclair died Monday in a Winnipeg hospital at the age of 73.
A teepee and a sacred fire were set up outside the Manitoba legislature for people to pay their respects hours after news of his death became public. The province has said it will remain open to the public until Sinclair’s funeral.
Sinclair’s family continues to invite people to visit the sacred fire and offer tobacco.
The family thanked the public for sharing words of love and support as tributes poured in this week.
“The significance of Mazina Giizhik’s (the One Who Speaks of Pictures in the Sky) impact and reach cannot be overstated,” the family said in a statement on Tuesday, noting Sinclair’s traditional Anishinaabe name.
“He touched many lives and impacted thousands of people.”
They encourage the public to celebrate his life and journey home.
A visitation for extended family, friends and community is also scheduled to take place Wednesday morning.
Leaders from across Canada shared their memories of Sinclair.
Premier Wab Kinew called Sinclair one of the key architects of the era of reconciliation.
Prime Minister Justin Trudeau said Sinclair was a teacher, a guide and a friend who helped the country navigate tough realities.
Sinclair was the first Indigenous judge in Manitoba — the second in Canada.
He served as co-chair of the Aboriginal Justice Inquiry of Manitoba to examine whether the justice system was failing Indigenous people after the murder of Helen Betty Osborne and the police shooting death of First Nations leader J.J. Harper.
In leading the Truth and Reconciliation Commission, he participated in hundreds of hearings across Canada and heard testimony from thousands of residential school survivors.
The commissioners released their widely influential final report in 2015, which described what took place at the institutions as cultural genocide and included 94 calls to action.
This report by The Canadian Press was first published Nov. 5, 2024.
