Canada Plays its China Card
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Canada Plays its China Card

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Canadian Prime Minister Stephen Harper has announced that he will visit China next month, in a further sign that despite a slow start, his government is increasingly interested in the Middle Kingdom.

The visit will be his second since he took office in 2006, the first coming in December 2009 when he was chided by Premier Wen Jiabao for waiting so long to visit. Harper’s minority Conservative government had been slow to warm to China, putting concerns over human rights before trade and economic development. But all that is changing, driven in large part by China’s insatiable thirst for access to resources – and some hiccups in Canada’s economic relations with the United States.

Over the past several years, Chinese resource companies have moved aggressively to take stakes in Canada’s oil sands play; in 2010 Sinopec purchased a 9 percent stake in Syncrude Canada, the biggest oil sands project, for $4.65 billion, while rival CNOOC recently closed a $2.1 billion deal to acquire heavy oil producer Opti Canada Ltd. It has also recently been revealed that Sinopec is amongst a group of investors providing early-stage funding for the $5.5 billion Northern Gateway pipeline which, if ever built, will take Alberta oil sands bitumen across northern British Columbia to the west coast for shipment to Asia.

China’s appetite for resources isn’t unique to Canada, of course, but an interesting series of events in the United States has strengthened China’s hand, and led Harper to look more favorably on China and Chinese investments in the resource area. Back in 2004, under the previous Liberal government, MinMetals made an aborted bid for the Canadian mining giant, Noranda. The deal wasn’t completed reportedly owing to other business dealings that Noranda undertook. But the threatened takeover aroused much controversy and soul-searching in Canada regarding the wisdom of letting a state-owned Chinese corporation take such a large role in a Canadian resources sector. China got the distinct impression that its interest wasn’t welcome.

Yet those considerations seem secondary now that the Obama administration has announced that it will reject the application by Trans-Canada Pipeline to extend the Keystone XL from Alberta through sensitive ecological areas in Nebraska to Texas (although it has said the company can reapply, and Trans-Canada has confirmed that it will do so using a new route). The completion of this pipeline would help lock in the U.S. market for Alberta heavy oil, but opposition from environmentalists in the United States has forced the Obama administration to take the decision to disallow the application.

Obama would have preferred to delay any decision until after this year’s presidential election, hoping to offend neither environmentalists nor those who support gaining greater access to Canadian oil as a way of weaning the U.S. off reliance on other less reliable foreign suppliers. However, it was forced to issue a ruling given a February deadline imposed by Republicans through a rider on an unrelated piece of legislation.

The original Obama decision to delay the Keystone review, delivered at the APEC meeting in Honolulu at the same time as Canada was clamoring to be allowed to join the Trans-Pacific Partnership (TPP) trade negotiations, led Harper to announce publicly that Canada needed to seek out other markets if the Americans don’t want Canadian oil, and the decision on January 18 to reject the application further strengthened his determination to diversify Canada's markets. Thus, China’s ambitions nicely dovetail with Canada’s need to introduce a third party into its dealings with the Obama administration.

All this comes at a time when the Harper government is finally rediscovering Canada’s Asia-Pacific dimension. The decision to publicly throw Canada’s hat into the TPP ring is one concrete demonstration of this belated initiative. The rebuilding of Canada-China ties is another. Canada used to enjoy “privileged” relations with China going back to the 1970s, but that legacy was squandered. Still, bilateral trade is relatively strong and growing (although China enjoys a 3:1 trade surplus with Canada). In addition, an investment agreement with China is being finalized, ostensibly to promote Canadian investment in China, although the real effect will be to accelerate Chinese investment in Canada’s oil, gas and mining sectors.

Harper’s visit to Beijing will be one of the last to be hosted by the “old guard” given impending leadership changes this year, but clearly his “China card” needed to be played quickly, so a February visit has now been confirmed. Doing the next round of their minuet clearly suits both parties right now. Let the dance begin.

Hugh L. Stephens is a former senior official in the Canadian Department of Foreign Affairs and International Trade. He is currently Principal of Trans-Pacific Connections/TPC Consulting, based in Vancouver, BC, Canada (www.tpconnections.com).

Comments
13
Colin Chau
January 28, 2012 at 01:52

THIS THREAD IS FREAKIN AWESOME!

Oh Canada
January 27, 2012 at 20:25

China can wait until November.

The US protected Canada during the cold war, and is the best trade partner.
We are great allies, and friends. Harper must understand what he is dealing with
is temporary

RETURN TO REASON:

Barry Soetoro Frankenstein

Exclusive: Ilana Mercer highlights impact of fact Obama is a product of the State check her out on World New Daily

Canuck
January 27, 2012 at 17:08

Great comment, well written. Been living in Asia for 6 years, and the level of Xenophobia is crazy. I think Asia will never be a super power sphere because of this. Canada is in a good position because it accepts people from around the world who bring in new ideas and hard work.

Papa John
January 24, 2012 at 04:48

Hahaha. You really shut off the CCP 50cent here. Great comments!

Canuckistan
January 23, 2012 at 02:20

@Henry003, the author is obviously shilling for Enbridge and China’s interest in the Northern Gateway Pipeline, when it comes to exporting oil our allies are in the U.S.A NOT in CHINA…

About Canada’s large Asian population and our suicidal mass immigration policy from non-traditional sources;

Canada actually needs to curb their immigration from China; Immigration fraudsters have been exploiting our new rules. Federal anti-fraud unit found that at least 22% of Chinese applicants misrepresented their qualifications/credentials:

One study of skilled worker applicants from Hong Kong under the AEO program during 2008-10 found only 22 per cent had genuine jobs in Canada and many had “very low” English-speaking skills.

An analysis by the Canadian government’s anti-fraud unit in Beijing, meanwhile, found that between late 2008 and early 2010, more than one in five applicants (22 per cent) misrepresented their own employment records.

The greatest abusers were supposed “financial auditors and accountants,” as 42 per cent of them were lying about their credentials and were in many cases merely cashiers or bookkeepers.

Another above-average category was financial managers, with 27 per cent of applications being fraudulent.

Another 2010 study of applicants from Taiwan found that of 31 AEO applicants, the vast majority headed for B.C., only five – or 16 per cent of the total – took jobs with the employers that made the offers.

Reason
January 22, 2012 at 17:12

sublime…

Bierstadt
January 22, 2012 at 09:38

Well said.

John Chan
January 22, 2012 at 02:25

There is no racial discrimination in Canada, as the Canadian claimed. There are only glass ceiling, Canadian experience, and you are not one of us to filter out the unwanted elements.

Eduardo
January 21, 2012 at 12:47

“Why because their gaze is only toward [..] Latin America.”

I don’t know where you got that from, the relation between Canada and Latin America is almost unexistant. Or at least that’s the way it is seen over here.

Oro Invictus
January 21, 2012 at 10:49

@Henry003

Oh my, oh my… Where to begin…

-”…were pioneer in Nuclear Power they can’t even sell a single nuclear power in 20 odd years”
Right, no nuclear tech… Except for all those heavy water reactors we’ve been shipping out for decades. Oh, and the breakthroughs in breeder reactor technology. Plus pioneering work in inertial fusion technologies. And isotope production/transmutation research. So, other than all of that, yeah, no nuclear tech.

-”They failed to capitalized on large Chinese immigrant though highly qualify most of the time they faced polite discrimination and get passed by in promotion.”
Ignoring your exhorting of Asian ethnic supremacy, it would probably be best if, the next time you decide to create imaginary racial prejudice, you make sure the country you are leveling it against isn’t regularly ranked among the least racist countries on Earth (via incidence of hate crimes, civil suites based on discrimination, etc.) and having one of the most diverse work forces on the planet (including executive positions). Hey, here’s a fun game: I’ll count how many Canadian politicians aren’t Caucasian and you count how many PRC politicians aren’t Chinese. Hell, I’ll even let you cheat by also allowing you to count those who aren’t Han Chinese and/or urban dwellers, it won’t change the outcome; there’s a reason the PRC has oft been cited as being right up there with South Korea in terms of pervasive racism.

-With the time they will also lost their living standard.
Really? Because the living standards here have been either holding steady or increasing. Actually, this also ties in with your ridiculous racism allegations; if living standards here are dropping and there is so much racism towards the Chinese, why has the number of immigrants from China to Canada sharply ROSE in recent years, even after the supposed brilliant economic feats the PRC has been pulling? Oh, and just so you know, the amount of expats returning to China? It’s been dropping almost as fast as the amount coming to Canada has been rising.

-”Hundreds and hundred of company left Canada.Massey Ferguson gone,AECL gone, Molson beer company gone, Northern Telecom gone, soon Blackberry will be gone too”
Well, ignoring most of these companies either A) Simply changed their names or B) Created larger international division with controlling shares still held by Canadians, I’m curious where you got that figure of “hundreds and hundred (sic)” of companies having left Canada. If you want to talk about companies shutting down or losing assets to overseas interests, why not just go with the thousands of PRC companies that have been doing that (source: PRC’s own statistics, pretty much any news site [including this one], etc.). Granted, these were mostly just small companies, but at least these companies did undergo the aforementioned changes (rather than the ones you cited). The exceptions, of course, are the large PRC companies in the Biotech, Materials Sciences, and Engineering (primarily high-tech) sectors which have been left in the dust by other countries; especially Biotech and Materials Sciences, which are currently being led by companies from… Wait for it… Canada.

Henry003
January 21, 2012 at 08:49

Canada is a fool and cannot capitalize on their rich natural resources and large Asian population because of the stupidity of their elite.

They cannot even see beyond their narrow horizon of Anglo Saxon world. that is why even though they were pioneer in Nuclear Power they can’t even sell a single nuclear power in 20 odd years.The company eventually sold for pittance after spending billion of dollar in development.Why because their gaze is only toward European and Latin America.They failed to capitalized on large Chinese immigrant though highly qualify most of the time they faced polite discrimination and get passed by in promotion.

Canada is falling behind Australia when it come to gain market in Asia, With the time they will also lost their living standard. Hundreds and hundred of company left Canada.Massey Ferguson gone,AECL gone, Molson beer company gone, Northern Telecom gone, soon Blackberry will be gone too

Oro Invictus
January 21, 2012 at 05:51

@1Makyo

1) The PRC is not socialist, they are capitalist and autocratic, the former of which you actually said directly after your aforementioned mislabeling. The irony here is that, in terms of actual socialist doctrine, the US is actually far MORE socialist than the PRC (albeit, Canada exceeds both on this particular sociological leaning). I do agree, though, that socialism (if it can be properly implemented, something our current neurobiology renders almost impossible) is the superior system.

2) The US is not on the precipice of destruction. They are not even close; the average sentiment in the US, aside from the usual griping about various political issues and individuals in power, is that this is just a tough time. There is no influx of US refugees or any such nonsense, there are no massive social upheavals (from a pan-cultural historical perspective). Having spent quite a bit of time in China myself, I can say that there is far more antipathy and distress over the country’s future, particularly amongst the migrant workers, non-Han Chinese, low-income families, intellectuals, rural inhabitants and immigrants, urban youth, Tibetans, etc. (i.e. the groups which actually make up the majority of the country’s inhabitants). The only reason these disparate groups haven’t affected radical change is due to the PRC’s inhibition of information exchange and non-aligned goals/attitudes (albeit, if you remove/bypass said repression of information to a great enough extent, history teaches us said groups tend to coalesce in goals, at least for a time).

3) Yep, the US does see alot more abortion, non-persecuted same-sex relations, drug issues, and so on than alot of the more Islamic (or really pretty much any religion, including the cults of personality the PRC utilizes) quasi-theocracies. You know what country sees even more of these things? Canada (well, except perhaps for drug usage, albeit that is because of more sensible and relaxed drug regulation). See, it turns out our population planning systems, our tolerance and acceptance of various groups and belief systems, and non-Draconian policies in regards to civil liberties is why Canada is doing so well. I’m not a nationalist or a patriot, but I must give the Canadian government credit for achieving what it has (even with that bellicose fool, Harper, mucking things up).

4) You do realize that the same issues facing the US-Canada trade will apply to the PRC, right? Thanks to the relative ineptitude of our government, popular movements can quickly shut down such projects (another thing which has allowed Canada to weather the global economic climate better than most countries on Earth, including [if one considers current inflation concerns, environmental degradation, and social and legal rights] the PRC); in the case of the PRC, concerns over human rights and foreign policy will prove even more likely to forestall additional trade than the environmental issues. Just ask India, when they broke their agreement with Canada and decided to use one of our research reactors to jumpstart their entire nuclear weapons programs; that was met with a virtual freezing of trade and information transfer.

5) Given the US and Canada have a pretty-much inseparable relationship at this point, your apparent expectations that Canada will decide to abandon the US and jump into the PRC’s arms are ludicrous and quite telling of your own detachment from reality.

I could continue, but for the sake of brevity and the fact that your narrow-mindedness will likely be no more swayed by logic than any of the other PRC mouth-pieces commenting on this site, allow me to finish with this thought: As you may know, Canada has some of the largest populations of expat Chinese on the planet, many of them actually having come over in just the last while (that is, during the PRC’s economic “miracle” which resembles the other few dozen such economic miracles human history have seen, some of them in China, and most of them ending badly [Macedonian, Carthaginian, Athenian, etc.]). I can take a quick ride over to Vancouver’s China-Town, and you know what? There is nary a person singing the praises of the PRC. Hell, it is from these communities we’ve seen some of the strongest resistance to increasing trade due to disdain of the PRC government and/or its practices. Some here, having once been supportive of the PRC, are surprised over how they tolerate things there; I’ve found the best idiom that seems to translate is “When you’re in the belly of beast, its easiest to believe it has your best interests in mind”.

In short: This trade thing is not about Canada abandoning a failing (see: not doing too badly at all) US economic relationship for a superior (see: reminiscient of a thousand other short-sighted grasps for economic hegemony via exploitation of a nation’s population which almost inevitably back-fire) PRC trade partnership, it’s just about that genius (see: the man who wanted to militarize the North Pole and guard it as exclusively Canadian territory) Harper and his pals in the oil industry wanting to make a little more money.

1Makyo
January 21, 2012 at 03:37

Canada should sell this oil to China. No reason to wait for the US to make up her mind. Like a menopausal woman, America dithers on the precipice of self destruction and soon won’t be able to pay her b bills anyway.
America is waking up to the reality that our traditional way of life is pretty much over. Capitalism has been replaced by socialism. Free enterprise has been replaced with crony capitalism. Political correctness has replaced traditional marriage and attitudes about morality. Abortion is just fine now in America. Maybe Islam will win after all. Certain things about Islam are superior to the culture in America today. Abortion? Forget about it. Same sex marriage? Forget it.
Same sex sex? At your own peril. Divorce? Not going to happen. Drug use? Prohibited by culture and law. On an on. Don’t want to bore you here.
Anyway, Americans with the wherewithall are leaving the country now. Some are going to Canada. Some going to Mexico. Some going to places where money can keep them going safely for awhile. We will become a diaspora for a time.

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