China and Canada: where do we stand?
Prime Minister Stephen Harper’s visit to China has put the spotlight on trade and foreign affairs. Here’s an explainer on where we stand with the powerful Asian nation.
This type of bilateral agreement has been in the works for almost 20 years, and it will become one of just a few similar agreements ratified by the Chinese government. Despite China’s significant trade with the US and the European Union, neither has secured a deal like the one Harper signed on to today.
Canada, on the other hand, has obtained FIPAs with 24 other countries, and there are 10 more on the table.
“This agreement is an historic step forward. When implemented it will provide greater predictability and protection for Canadians seeking to do business in China.”
- Prime Minister Stephen Harper, Beijing announcement (Feb. 8 2012)
Details of the final agreement have yet to be released, as both governments must complete a legal review before it can be put into action. In Canada, that means it will be up for debate in the House of Commons.
In addition to the FIPA, Harper said the government has also signed agreements regarding air transportation, agriculture, science and technology, and energy.
Energy and natural resources are topics being closely watched by Canadians during the Prime Minister’s time in China. The main issue on peoples’ minds is the government’s agenda to facilitate oil exports from the oil sands to Asia, primarily through the proposed Enbridge Northern Gateway pipeline and resulting tanker routes.
Because of China’s huge (and growing) demand for resources like oil and gas, and because of Canada’s position as a resource-rich country, these industries have been a big focus for Chinese investment.
A recent report from the International Energy Agency shows that state-owned oil companies in China have invested over $7 billion since 2002 to secure stakes in oil sands projects.
Their acquisitions include deals with Northern Lights, MEG Energy, Athabasca Oil Sands, Penn West Energy and Syncrude. With growing development in the oil sands—and Harper’s brand new investment deal with China—acquisitions like these are expected to increase over the coming years.
A Memorandum of Understanding (MOU) on “energy cooperation”, signed Wednesday in Beijing, will help grease the wheels for additional investment and partnerships. It was just one of eight smaller agreements signed in addition to the FIPA, and aims to help China increase energy imports from Canada.
Critics of the oil sands and Northern Gateway project have recently held protests and written letters appealing to the Chinese government—and the Chinese public—to refrain from investing in Canadian resources. The Yinka Dene Alliance wrote an open letter earlier this week in hopes that President Hu Jintao would reconsider agreements regarding oil and pipeline development.
In addition to environmental concerns over the oil sands, the First Nations group also used the letter to address human rights offences faced by Aboriginals in Canada. These appeals are not likely to sway Chinese officials—in fact, human rights is one of the more difficult topics Prime Minister Harper was expected to address during his diplomatic visit.
Aside from economics, Canadians have also been expecting Harper to address China’s recent decision to veto a UN Security Council resolution that would have helped put a stop to violence in Syria. Like many other countries, Canada’s position is that Syrian President Bashar al-Assad must step down, and that the country’s armed forces should cease violence that has resulted in the deaths of thousands of citizens.
Officials reported that the topic did in fact come up, during talks with Chinese Premier Wen Jiabao on Wednesday.
“I raised, in very clear and strong terms, Canada's position on this issue…We would hope to see in the future action from the Security Council,” Harper told reporters in Beijing.