China’s weekend announcement that it would stop pegging its currency to the U.S. dollar and allow it to float within a wider range from the dollar’s value presents opportunities for B.C. businesses.
“Blenz Coffee, for example, has outlets in China. It will benefit to the extent that Chinese consumers will have more disposable income and will want to spend on luxuries such as coffee,” said Yuen Pau Woo, who is CEO of Vancouver’s Asia Pacific Foundation of Canada.
While riding SkyTrain on his way home from work June 21, Woo told Business in Vancouver that he does not think China’s tinkering with its monetary policy will directly improve B.C. raw lumber exports or coal exports.
Rather, B.C. manufacturers who export value-added products will have more success, he said.
“The bottom line is that B.C. doesn’t export a lot of consumer products to China,” Woo said. “However, because the purchasing power of Chinese consumers will increase as a result of the currency appreciation, they will be in a position to acquire more services, travel abroad and have their money go further.”
China announced in December that it would grant Canada approved destination status. Important details, however, such as when exactly this status would start, were not announced.
“We may well have an announcement of [those details] when [Chinese] President Hu Jintao comes to Canada in a few days.”
Toronto hosts the G20 summit of world leaders June 26 and 27.