Join our Mailing List

"Canada can, within a positive friendly atmosphere, ask the Chinese government to resolve the Tibetan situation."

Canada-China: Hu visit caps a triumphant rise in relations

June 24, 2010

By Carl Meyer
Embassy (Canada)
June 23, 2010

It was June 1 and Finance Minister Jim Flaherty
and Trade Minister Peter Van Loan were both
soaking up the spectacle of the elegant,
cedar-wood-planked, Cirque du Soleil-designed
Canada Pavilion at the Shanghai Expo.

Mr. Van Loan had just taken part in the
Canada-China Science and Technology Committee
meeting at the Pavilion earlier that day, and was
now joining up with his Cabinet colleague at a
reception that evening. Mr. Flaherty had recently
arrived in China for what would be an ultimately
successful effort to find common cause with the
Middle Kingdom in opposing a global bank tax.

The crowd that night was made up of movers and
shakers of the Canada-China business community,
the power players at the forefront of Canada's
rapid commercial re-engagement with the giant dragon of the East.

Amongst them was Gordon Houlden, the director of
the China Institute at the University of Alberta.
His description of the mood of the crowd as
energized and optimistic, happy to see
re-engagement taking place, is a telling sign of what's to come.

Prime Minister Stephen Harper is hosting Chinese
President Hu Jintao this week as he conducts his
first bilateral visit to Canada under the
Conservative government. His visit comes as
Canada gears up to host the world at the G20 summit in Toronto.

"Who would've thought 10 or 20 years ago that we
would, in effect, have crucial common cause with
the Chinese on issues like a global bank tax.
That was unthinkable," said Mr. Houlden.

"I do think the consensus is, certainly in the
business community, and I believe amongst China
watchers generally, that a re-engagement with
visits by ministers and above is good stuff, and welcome."

China's recent history with Canada follows two
storylines. On the trade front, the two countries
have been on an almost vertically-upward trajectory over the last decade.

Last year, Canada sent $11-billion worth of
exports to China and brought in $39-billion worth
of imports. Exports have more than tripled over
the last decade, while imports, reflecting a
hyperactive Chinese economy as the world's workshop, grew by over five times.

This has been accented lately by Chinese
state-owned corporations sinking billions into
the Canadian oil sands and other natural
resources through highly-publicized mega-grabs.
Experts say these moves mark a shift in Chinese
geo-strategic investment, showing that the
Chinese government is now more comfortable investing in Canadian equity.

The government hints that the Canada Pavilion is
a metonym of that warming relationship. Receiving
tens of thousands of visitors a day, the Pavilion
has reportedly been Ground Zero for major
business deals between Canadian and Chinese firms.

But the business relationship is sometimes not as
shiny and sparkling as the surface of the
Pavilion seems to suggest. There have been spats
over Canadian canola and pork exports, and there
have been ruminations amongst some that foreign
state-run corporations shouldn't be buying up so much in Canada.

As well, the government has often found itself
caught in -- and participating in -- a battle of
world leaders criticizing China over its monetary
policy. To keep exports competitive in its major
export markets in the EU and the US, the Chinese
central bank attempts to play off the yuan against the euro and the dollar.

That move was sure to position China as a
whipping boy in the G20 summit, until an
eleventh-hour move by the Chinese government
diffused the situation by acknowledging that it
will let its currency appreciate. By how much,
though, is still an unanswered question.

All this to say that politically, relations under
Prime Minister Stephen Harper's Conservative
government have not followed the straight upward
path of trade growth. Instead, it has been more of an inverse bell curve.

When Mr. Harper came to power in 2006, there was
a noticeable cooling-off period. Mr. Harper began
to take many opportunities to lambast the Chinese
government over its human rights record,
something the Chinese did not appreciate, to put it lightly.

Experts say the low point was reached when the
Dalai Lama visited Canada in the fall of 2007,
provoking a curt reaction from Chinese
officials.Then-trade minister Stockwell Day's
visit in late 2008, many argue, was the restart
button Canada needed, and it has accelerated from there.

Mr. Harper himself, while he has met with Mr. Hu
several times at various multilateral events,
never paid an official state visit to China until
December. But in the last two years, both
countries have sent high-level ministers on state
visits. Between 2006 and 2008, four Chinese
ministers and one senior official visited Canada.
In 2009 alone, three ministers and a senior official made the trek.

Mr. Hu's visit will round off this exchange, and
everyone agrees that it signifies more than
anything else that China is ready to take the
relationship with Canada seriously.

"This is a natural extension that China has
always been in the so-called 'waiting position'
even when the relations were down between early
2006 and early 2009," said Wenran Jiang, a China
expert at the University of Alberta who also
works at the China Institute as the Mactaggart Research Chair.

"They were always saying the fundamentals are
good and they hoped the Canadians will turn
around, and it looks like their patience paid off."

Mr. Jiang feels the switch in the Conservative
Party attitude toward China occurred in the
summer of 2008, when a crisis between Tibet and
China erupted in the middle of the Olympic torch relay.

"Chinese-origin Canadians spoke out
overwhelmingly against a very negative policy by
the Conservative government in promoting Tibetan
independence. And people were coming out in
massive numbers in support of the Olympics.
That's I think where the real turnaround in
Conservative circles happened on their China policy," he said.

"Of course there were many other issues in the
learning curve, but I think that they realized by
the middle of 2008 that the continuous policy of
the previous period would not deliver any
domestic notes, not with this big bloc of
Chinese-Canadians in Vancouver and Toronto."

The initial cooling-off period, then, was the
product of an inexperienced, minority government
coming to grips with the constant fear of an
election, and its determination to avoid that by
scoring political points through a focus on
domestic issues, argues Charles Burton, who
follows Canada-China relations at Brock University.

"Now that the prospects for an election are
fewer, it allows for the possibility of doing
more in terms of realizing Canadian interests
abroad. Once ministers started to go to China,
once they saw the potential there, the thing has
started to gain some momentum," he said.

Some have argued that in warming relations,
Canada is foregoing its principled stance on
human rights and succumbing to the lure of the
almighty dollar. They argue Mr. Harper was right
to speak out against Chinese oppression,
particularly when it comes to its dealings with the Tibetan people.

"What often happens in this debate is that there
is this knee-jerk reaction from Canadian business
that if you talk human rights with China, it's
bad for business. Well, if you look at the trade
flow, there has been no consequence for business,
and I think the government of Canada has to look
at the stats," said Dermod Travis, executive
director of the Canada-Tibet Committe.

"This is a unique opportunity for the G20 to put
some of these important issues related to Tibet,
related to China on the table, and to encourage
them, as a great many of them have done on a
bilateral level, to bring about a solution to the
Tibet issue, and secondly to advance the cause of human rights in China."

But Mr. Burton said he doesn't see any evidence
of the government ditching its human rights line.
He argues it has little effect these days, since
Chinese government officials "are by now
perfectly inured to a kind of ritualistic raising of the human rights concern."

"In general I don't think the policy has changed
with regards to human rights. Mr. Harper made
some quite strong statements about human rights
when he announced the G8, and so I think that
issue is still an important one for the Conservatives."

And Mr. Houlden felt that an increase of spats is
good for the relationship, suggesting that
"ironically, the more substantive the
relationship, the higher the potential for conflict of some sort."

"As it becomes more substantive, particularly in
economic terms, there is the potential reality of
new issues. So you can have a totally benign
relationship with Lichtenstein, where there's no volume and no substance.

"But look at the spats we get into with the United States over trade issues."
CTC National Office 1425 René-Lévesque Blvd West, 3rd Floor, Montréal, Québec, Canada, H3G 1T7
T: (514) 487-0665
Developed by plank