Federal Transport Minister John Baird has sought to ease fears of protectionism in China's stimulus spending, saying there is plenty of opportunity for Canadian companies operating in the country.
"There's a lot of countries in the world moving aggressively on stimulus and China has been one that has not just talked the talk, but it is walking the walk," Mr. Baird said yesterday in Beijing, on the third day of a nine-day visit to China.
Mr. Baird also said China and Canada have pledged to work together against Buy American policies in U.S. stimulus spending, which he called "inward looking" and "distinctly unhelpful."
"I think there aren't just significant opportunities to be had but significant opportunities that are being realized," he said, citing Montreal-based Bombardier Inc. as a model.
Mr. Baird's visit - which will also take in Shanghai, Guangzhou, Shenzhen, Hong Kong and Macau - is aimed at promoting Canadian companies and technology and the Asia-Pacific Gateway in British Columbia that is intended to ease shipping routes between the two countries.
The trip comes less than a month after reports emerged that a Buy Chinese policy has been implemented for all government procurement under Beijing's four-trillion-yuan ($675-billion U.S.) stimulus plan, announced last fall.
Chinese state media said strict new guidelines for government procurement have reportedly been issued by China's National Development and Reform Commission and eight other ministries.
The guidelines give domestic products absolute priority unless they are unattainable in China, in which case any purchase of imported products must be reported to and approved by Chinese authorities.
China's Commerce Ministry said the move was designed to root out corruption, but complaints were raised as early as May about the strict procurement rules, when the head of the European Union Chamber of Commerce in China warned that foreign companies' attempts to bid on some stimulus projects were going nowhere.
"All the foreigners are out of the race," the business group's president, Jorg Wuttke, told reporters in May, after all foreign companies were rejected early in bidding for wind energy projects worth nearly $7-billion (U.S.). "There seems to be a drive by the central government to award this to Chinese and not Europeans established in China," he said.
Canadian businesses established in China, including mainstays such as Bombardier and SNC-Lavalin Group Inc. as well as smaller companies, have been watching reports of Chinese protectionism, but industry watchers say they have felt little impact so far.
"We're all worried about buy-local provisions in everyone's stimulus package and Canada has cause to be pretty worried because our two major trade partners, the United States and China, could swing the wrong way," noted Howard Balloch, a former Canadian ambassador and head of the Canada-China Business Council who now runs a boutique investment bank out of Beijing.
"However, I don't think we've seen much evidence of it happening yet," Mr. Balloch said, adding that "the worry is general, the worry is not specific to transportation [projects]"
Mr. Baird, who is also responsible for Canadian infrastructure, is the third federal minister to visit China in three months, following Trade Minister Stockwell Day and Foreign Affairs Minister Lawrence Cannon.
But Canadian business leaders have been warning for months that the failure of Prime Minister Stephen Harper to visit China is holding back the relationship between the two countries. Last month, Chinese Foreign Minister Yang Jiechi repeated an invitation to Mr. Harper, alluding to the "difficulties" in the relationship in recent times.
Although Mr. Harper is widely expected to visit to China in November, after the Asia-Pacific Economic Co-operation summit in Singapore, dates have not been officially confirmed.
Mr. Baird dodged the question of a prime ministerial visit yesterday when asked by a reporter from the state-run People's Daily newspaper. "I think there's been a significant warming of our relationship certainly over the past year. I'm the third senior minister to visit Beijing in as many months," Mr. Baird said.
"Obviously there's a lot of desire to have the Prime Minister here as well. It's not for me to make announcements on his schedule."