Canada Joins the Indo-Pacific Strategy Club

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Canada Joins the Indo-Pacific Strategy Club

The Indo-Pacific is being transformed, but not in the way Xi Jinping promised. Just witness Canada’s surprising U-turn on China.

Canada Joins the Indo-Pacific Strategy Club

Prime Minister Justin Trudeau at the Asia Pacific Economic Cooperation (APEC) Summit, in Bangkok, Thailand, on Friday, November 18, 2022.

Credit: Facebook/Justin Trudeau

Xi Jinping promised early in his tenure that China would contribute to regional cooperation in the Asia-Pacific. Instead, what we have often seen are aggressive demands. As a consequence, other nations in the Indo-Pacific region are working more closely together, driven by a common assessment that the risks of engaging with China under Xi have risen significantly in contrast to his predecessors. Indo-Pacific strategies for collaboration, and new or renewed military alliances, have become key platforms for regional partnerships. Now feeling threatened, Xi has warned that Asia-Pacific nations should not relapse into a “Cold War mentality.”

The latest nation to diversify away from China is Canada, which this week announced an Indo-Pacific Strategy that will expand its collaboration with other countries in the region in the wake of four years of frigid relations with Beijing. It is comprehensive and well-resourced.

Canada’s strategy has come as a surprise to many, as it recognizes head-on China’s aggressive tactics. In doing so, it moves away from past attempts to appeal to Beijing, rooted in Prime Minister Pierre Trudeau’s early recognition of China in 1970, his son (and current prime minister) Justin’s childhood trip to China on a state visit with his father, and the deep Liberal Party business ties to the country.

Over the past decade, a number of nations have adopted Indo-Pacific strategies. Japan felt China’s wrath during a 2012 dispute over the Senkaku Islands, but rather than cave in to Beijing, Japan began to broaden and deepen its relations with other countries in the region, and ultimately translated this reset into the first “Free and Open Indo-Pacific” Strategy.

Since then we have seen two of China’s contiguous neighbors, India and Bhutan, lose parts of their claimed territory via armed Chinese forays that have resulted in the occupation of disputed land and the building of infrastructure. On the seas, countries have seen Chinese fleets overfishing and China’s coast guard challenging nations in their own territorial waters.

Foreign businesses in China have protested the government’s unfair business practices and requirements for Chinese majority joint ventures. The Chinese market is becoming more unpredictable, with foreign companies seeing policies changing radically with no notice, while share values drop. In contrast, the prospect of working in other countries that follow the rule of law has real appeal.

Numerous countries and groupings now have Indo-Pacific strategies, including the Trump and Biden administrations in the United States, India, New Zealand, the Association of Southeast Asian Nations (ASEAN), France, the United Kingdom, the European Union (EU), and, by year’s end, South Korea. Australia also devoted a section of its Foreign Policy White Paper to the Indo-Pacific. The European Parliament has gone a step further in calling on the Council to develop a new more assertive EU-China Strategy with 69 elements, recognizing that China is increasingly an economic competitor and systemic rival.

In 2019, Canada was deep in a China crisis brought on by its arrest on behalf of the United States of the CFO of the telecommunications firm Huawei. Canadian officials sought my advice as someone who had engaged with Chinese organizations and Chinese Communist Party officials since 1979. One of my recommendations was that Canada launch an Indo-Pacific strategy that would strengthen relations with other countries in the region – not only like-minded countries but also those with common interests such as Vietnam. It would also support companies that needed to reduce their China risk. The strategy has been under development since early November 2019.

There have been numerous drafts, comprehensive but demanding too much funding. The next draft was a thin high-level strategy; perhaps it would not even mention China. Then it was to be just statements in a speech, which prompted me to write an op-ed with Australian John Garrick about the need for both our countries to develop comprehensive strategies that are fully resourced.

On April 13 of this year, Foreign Minister Melanie Joly met with Vietnam’s Prime Minister Pham Minh Chinh and his Foreign Minister Bui Thanh Son to brief them on Canada’s planned strategy. The next day Son received a call from China’s Foreign Minister Wang Yi warning of “the risk of regional tension and antagonism with the U.S.’ pushing of the ‘Indo-Pacific Strategy.’” Evidently, China sees Indo-Pacific strategies as opposing its interests and is putting pressure on other governments not to develop or cooperate with them.

No doubt Canadian officials received similar representations from China’s Embassy in Ottawa. Joly had committed to unveiling the strategy on her return from her Asia trip, but nothing was presented and officials made it known informally that the release was postponed indefinitely. In June, an Indo-Pacific Advisory Committee was appointed, whose membership suggested that the government was calibrating its China policies.

Months dragged on, but in October we began to see the slow reveal of a new policy direction. In a speech at the Brookings Institution, Deputy Prime Minister Chrystia Freeland described China as coercive and decried “the strategic folly of economic reliance” on countries that do not share our moral values, proposing supply chains built on “friend-shoring.” Then Innovation Minister Francois-Philippe Champagne ordered the divestiture of Chinese ownership of three rare earths mining companies.

Joly previewed the strategy itself in a speech in which she called China “an increasingly disruptive global power” and expressed Canada’s concerns about human rights in Xinjiang, freedom of speech in Hong Kong, and threats to the status quo in the Taiwan Strait. Canada was waking up to the risks of doing business and assuming friendship with China.

At the ASEAN, G-20, and APEC Summits, Trudeau and Joly announced numerous new Canadian initiatives in the region in the fields of infrastructure, vaccine development, trade, gender rights, development assistance, and mine-clearance, with a particular focus on partnership with ASEAN nations. Canada will pledged to develop a deeper capacity to understand the new China, has joined the Blue Pacific initiative for Pacific islands, and has applied to join the Indo-Pacific Economic Framework.

Finally, on November 27, more than three years after it was initiated, Canada’s Indo-Pacific Strategy was released in Vancouver, with Joly declaring it “is about positioning Canada to be a reliable partner. It is an ambitious plan for the next decade.” A wide array of new initiatives totaling $2.3 billion Canadian dollars, the down payment on a 10-year plan involving 40 countries, was announced for implementation of the strategy.

The Trudeau government’s U-turn on China represented by the strategy has come as a surprise to many. While Canada will always trade with China, the China chapter of the Indo-Pacific Strategy is explicit that “China is an increasingly disruptive global power.” China’s rise was “enabled by the same international rules and norms that it now increasingly disregards” and it wants “to shape the international order into a more permissive environment for interests and values that increasingly depart from ours.” The Canadian government has issued warnings “to the business community to account for the growing risk of arbitrary application of Chinese laws.”

The strategy refers to protecting investments from state-owned enterprises, protecting Canadian research, and strengthening cyber systems. The plight of the Uyghurs and forced labor is mentioned, along with infringements of other human rights. The People’s Liberation Army gets special mention in the context of Canada working with military partners in the region – one clear asset we can contribute being technology.

There is much more in the strategy, and no doubt the United States has encouraged this new direction. But the bottom line is that China has turned out to be a bully rather than a friend. That has made all the difference.

In the past, Taiwan has often been omitted from Canadian government documents for fear of offending China, but in the strategy there is a commitment “to work with partners to push back against any unilateral actions that threaten the status quo in the Taiwan Strait, as well as the East and South China Seas.” It also pledges to “continue Canada’s multifaceted engagement with Taiwan,” which includes recent senior ministerial virtual discussions and parliamentary in-person meetings on trade and an investment agreement. Canadian consultations on Taiwan’s potential accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) brought strong and consistent overall support as a key export destination with a fellow democracy.

Like the U.S. Indo-Pacific Strategy, Canada’s new strategy takes a “whole-of-government approach” that covers defense, national security, cyber, agriculture, labor, natural resources, innovation, infrastructure, and trade, supporting Canadian companies to diversify their investments away from China. But it also constitutes a “whole-of-Canada approach,” with civil society developing increased engagement in the region, including education, business intelligence, clean tech, research, tourism, and ocean management.

Were China to behave like a responsible aspiring superpower, it would find that collaboration and cooperation would come naturally from other nations, as it did for Xi’s predecessors. Instead, countries are developing Indo-Pacific strategies to broaden and deepen their other relations in the region. They are calibrating their policies to restrict exposure to the geopolitical risk that comes with the sudden, aggressive actions of the Xi regime. Nations are strengthening their military alliances and technology collaborations.

The loser as these new initiatives continue to build is China. It didn’t have to happen. Xi is seeing the negative and inevitable outcome of his own aggressive tactics, and the region is collectively stronger in response.