One of the world’s largest investment managers is concerned that growing trade tensions could derail global markets.

BlackRock’s global head of active equities Mark Wiseman says that escalating trade tensions between the U.S. and China as well as lingering uncertainty over the future of the North American Free Trade Agreement are cause for alarm and could undo market gains from the past few years. 

“I think if we end up in a protracted trade war between the U.S. and China; If we aren’t willing or able to resolve our differences on NAFTA, then I think all bets are potentially off,” Wiseman, who was previously CEO at the Canada Pension Plan Investment Board told BNN in an exclusive interview on Monday.

The trade issue impact on the markets is markedly different from other – even more dramatic – global events, said Wiseman.

“Even if you look at events that shake us to the core like 9-11 [terrorist attacks], ultimately after some degree of correction, markets came back and reverted on the course they had been on for the past couple of decades,” he said. “The trade issue is somewhat different. The trade issue is a geo-political issue that can actually change the very foundation on the economic deal under which companies operate.”

Wiseman’s advice to investors is to look forward at the potential impact of the economic decisions being made, instead of taking a reactionary investing approach to economic data.

“I think we have to look at the announcements that are coming out. And, if you believe that they are going to come into force, or there is going to be a continued escalation of sort of trade hostilities, then you have to impute forward what that’s going to do to the economy,” Wiseman said.

“If you are – as an investor – reading about it in the trade figures that have already come out, you’re too late.”

Despite his concern over the future of global trade, Wiseman said he remains impressed by the resiliency of the Canadian economy.

“I think what’s interesting is actually how well the Canadian economy has performed in spite of what has been a reasonably sluggish commodities sector, whether that be oil and gas or other commodities,” Wiseman said.

“I think what we’ve seen actually in the resiliency of the Canadian economy is quite positive. We’ve seen much more diversification of growth. We’ve seen surprising job creation to the upside. That job creation interestingly is coming from places that we haven’t expected.”

Wiseman pointed to concerns about Canadian competitiveness in relation to its tax rates, but said he remains ‘bullish’ on the country’s economy.

“I’m actually quite bullish on Canada,” he said. “I think there [are] areas that we have to watch, including the increasing differential of tax rates between Canada and some of our neighbours.”