Like many parents in 2020, I was homeschooling my son this spring and one of the topics they were learning about in class was the impact of the gold rush on British Columbia during the late 1800s. It occurred to me that in fact this was one of the first events that really initiated trade, migration, and commerce between BC and California.
In 1848, some 300,000 people from the United States and abroad headed to the west coast to take advantage of the California gold rush after gold was discovered near Sutter’s Mill. Ten years later, the Fraser River Gold Rush began in 1858 after gold was discovered on the Thomson River in British Columbia. The governor of the Colony of Vancouver Island, James Douglas, sent a shipment of ore to the mint in San Francisco and this started a migration of some 30,000 men from California to BC. In fact, it is estimated that 80% of all the miners for this gold rush were from California. For BC, the Fraser River Gold Rush was the catalyst for the building of early road infrastructure, the founding of many towns, and was instrumental in BC becoming part of Canada in 1871.
Due to the geographic, demographic, and ideological similarities between BC and California the two jurisdictions have been historically key trading partners and will continue to be so in the future. Based on the dollar value of merchandise trade, California is the second largest destination for BC exports and third for Canadian exports. Total merchandise trade between BC and California was $6.2 billion Canadian dollars in 2019.
From the economic report, “Canada and Southern California: United through collaboration, defined by partnership, sustained by friendship” commissioned by the Consulate General of Canada in LA and sponsored by MAPLE Business Council last year, BC ranks as the 3rd highest source of inbound investment to Southern California with 101 establishments employing 5922 people with annual wages of $454 million. Also among the top ten Canadian companies in Southern California by employment, two are from BC: Telus/Xavient Digital and Lionsgate Productions.
While California operates at a trade surplus by value in this bilateral trade relationship, BC exports were up over 60% between 2010 and 2019 while California exports to BC were up a more moderate 10% over this same period.
So what are the major commodities being traded between BC and California?
Based on 2019 numbers from Stats Canada excess electrical power is the leading commodity sold by companies such as BC Hydro subsidiary Powerex, followed by farmed salmon and then various raw materials.
Conversely, in terms of California exports to BC, Tesla (based in Fremont, California) and other electronic car manufacturers led by a significant margin with the rest of the categories mostly consisting of various food products.
What do tv shows like: Flash, Riverdale, Arrow, The Good Doctor, Supergirl, Supernatural as well as movies such as: Deadpool, Fantastic Four, Fifty Shades of Grey, I Robot, Tomorrowland, and Godzilla have in common?
All these movies and tv programs were filmed in Vancouver, the third largest film and tv production centre in North America. The geographic proximity to Hollywood to Vancouver as well as tax incentives and skilled labour have been key drivers to this growth.
Key players like Sony Pictures Imageworks moved their head office from Culver City to Vancouver, while Lionsgate Productions have offices in Los Angeles and Vancouver and companies like Industrial Light and Magic (Disney) validate Vancouver’s reputation in the post-production industry with their local presence.
Redwood City based Electronic Arts’ large development and motion capture centre in Vancouver suburb, Burnaby, is a key part of the game development ecosystem in BC. The confluence of the game development ecosystem in Vancouver and the film and tv production industry has as a byproduct, produced one of the largest augmented and virtual reality hotspots in the world. The confluence of these sectors is in many ways a direct result of the maturation of the corporate linkages between BC and California.
BC has positioned itself through geographic proximity and deep demographic linkages to attract inbound business investment from the Asia Pacific region. In fact, even during the Fraser River Gold Rush many of the migrants from California had originally come from Asia.
West Coast cities such as Los Angeles, San Francisco and Vancouver have not only utilized physical infrastructure such as ports and airports to position themselves as a gateway between Asia and the Americas for the movement of people and goods but also acting as facilitators for the flow of information as intellectual gateways. This is not a new concept and is yet another common feature that aligns California with BC.
It is very apparent that California and BC have had a long history of trade and interjurisdictional commerce to the benefit of both economies yet there is so much more to learn about our respective jurisdictions. Beyond the industries I have mentioned earlier there are also many linkages that can be further developed such as in: life sciences, advanced manufacturing, space exploration, and clean technology to name a few. The trade linkages will no doubt be further enhanced by the USMCA agreement which increased the minimum threshold for duties and taxes effective this past July 2020.
We are very gratified to have an opportunity to mature MAPLE Business Council’s presence here in BC to a full chapter model after four years of ongoing events. Like our sister chapter in New York and others to come, we look forward to making meaningful connections across our network in Canada and the US; to not only facilitate further development of new cross-border linkages but also to ensure our existing trade, investment and innovation/entrepreneurship relationships are retained moving forward.
As I walked around our neighborhood in recent weeks, the air was a little smoky due to smoke from wildfires in California and other places along the US west coast. It brings to mind that despite a border, we are really closely interconnected and that our future prosperity amongst many economic and non-economic verticals are very intimately aligned.
Jason Tse
Executive Director, BC Chapter
MAPLE Business Council®