Canada vulnerable to Chinese economic slowdown

The continuing slowdown in China's increasingly important economy is adding to concerns about risks it could have to Canada's own fragile recovery.

China, one of the world's largest economies is still expanding at a booming rate, but slower than the 9.5 per cent annual pace of expansion seen in the previous quarter.

"China itself is still growing well and will continue to generate demand for commodities and exports," said Darius Kowalczyk, senior economist for Credit Agricole CIB in Hong Kong. Still, he said, "I don't think they are going to save the world."

China reports its economy continued to decelerate to 9.1-per cent growth in the third quarter, the worst performance in two years.

That's not disastrous news, but analysts say the negative trend in the world's second biggest economy should cause some concern Canada.

Not only is China now Canada's second largest trading partner, but it is a key driver of global demand and prices for oil and metals that Canada exports in abundance.

CIBC economist Peter Buchanan says lower demand in China will likely trim demand for Canadian commodities as well as reduce the prices that exporters can charge.