Canada and China have signed a reciprocal currency deal that's expected to dramatically boost exports.
The hub will foster far easier trade between the Canadian dollar and the Chinese yuan, also known as the renminbi. It makes Canada the first country in the Americas to have a deal to trade in the renminbi.
The signing of the deal was announced in Beijing today by Premier Li Keqiang and Prime Minister Stephen Harper.
Authorized by China's central bank, the deal will allow direct business between the Canadian dollar and the Chinese yuan, cutting out the middle man — in most cases, the U.S. dollar.
Canadian exporters forced to use the American currency to do business in China are faced with higher currency exchange costs and longer waits to close deals.
If Canada is to maintain the standard of living that it enjoys today, experts say, it needs to tap into the Chinese market. The currency deal is the first step on that path.
During meetings Saturday, Canada and China signed more than 20 commercial deals, valued at more than $1 billion.
Among the biggest agreements signed includes a deal for Bombardier to sell more than $1 billion in aircraft to China Express Airlines. An Air Canada-Air China joint venture is also valued at more than half a billion dollars.
It said trade between Canada and China supports more than 470,000 jobs in Canada a year, which was about 2.67% of total Canadian jobs in 2013.
