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Canadian Prime Minister Stephen Harper poses with Chinese President Xi Jinping for a photo at the Great Hall of the People in Beijing, Sunday, Nov. 9, 2014 ahead of the Asia-Pacific Economic Cooperation forum. (Petar Kujundzic/AP)
Canadian Prime Minister Stephen Harper poses with Chinese President Xi Jinping for a photo at the Great Hall of the People in Beijing, Sunday, Nov. 9, 2014 ahead of the Asia-Pacific Economic Cooperation forum. (Petar Kujundzic/AP)

Building on a breakthrough year in Canada-China relations Add to ...

As the world enters into the new year, we look back at 2014 when the booming China-Canada relations achieved remarkable progress.

Last November, Prime Minister Stephen Harper made his third visit to China. During the visit, the leaders of the two countries reached a new consensus on furthering bilateral relations and announced a joint list of outcomes including 20 co-operation agreements. The two sides agreed to establish an annual foreign affairs ministers dialogue and an annual economic and financial strategic dialogue, in order to plan bilateral relations and co-ordinate co-operation in different areas.

The two sides made a breakthrough in co-operation in areas of finance, economy and trade, investment, nuclear energy and people-to-people exchanges. In particular, the agreement on establishing the first North American renminbi clearing centre in Toronto and the ratification of the Foreign Investment Promotion and Protection Agreement play an important role in deepening bilateral co-operation in trade and investment. Moreover, both sides agreed to establish Track II dialogue mechanisms to study new approaches to enhance bilateral economic and trade relations, including signing a free-trade agreement and building an environmentally safe maritime energy corridor, in an effort to tap our economic and trade co-operation potentials. This will not only serve to form a long-term strategic plan for sustainable development of China-Canada bilateral relations, but also conform to the two major trends in today’s Asia-Pacific region–the development of free trade and connectivity.

Developing China-Canada relations is like sailing against currents. You either advance or recede. Despite some disputes and differences, China-Canada relations in 2014 achieved remarkable progress. It should be credited to the leaders of our two countries who showed great insight and attached importance to bilateral relations. We should also thank the two peoples from all sectors including business communities who gave their warm expectations and rigorous support. Following the will of the people and the global trend of co-operation, we can focus on co-operation by taking a comprehensive and over-arching perspective while properly managing differences.

Looking forward, 2015 is a year full of expectation of greater prosperity in China-Canada relations. As two major economies in the Asia-Pacific region, China-Canada co-operation is faced with a promising future of opportunities. In pursuit of the Chinese dream, China continues to deepen reform and open up in a more comprehensive manner at a higher level. The moderately fast growth of China’s economy at a “new normal” will offer even broader space for closer China-Canada bilateral co-operation. And as Canada gives more importance to co-operation with Asian countries by implementing a trade and investment diversification strategy, the bilateral co-operation between our countries will have a stronger dynamic for further growth.

This year marks the 45th anniversary of diplomatic ties and the 10th anniversary of strategic partnership between China and Canada. In this extraordinary year, I am confident that we will be fully able to translate our great opportunities and prospects of co-operation into realty with our joint efforts and the enabling conditions.

First, the two sides should implement the joint list of outcomes and consensus reached by the leaders of our countries in a comprehensive manner. The Chinese embassy and relevant Canadian federal departments have established a joint task force to co-ordinate our efforts, particularly, to accelerate research on FTA, the maritime energy corridor and deepen co-operation in finance and direct flights. The implementation of these agreements is in itself a concrete effort to deepen mutually beneficial co-operation and to make preparations for high-level exchanges in the future.

Second, expand bilateral trade by further enhancing trade of energy and resources. China is now the second largest trading partner, the second largest source of imports and the second largest export market of Canada. However, China-Canada bilateral trade only accounts for a small part of the total foreign trade of China and Canada respectively, which is largely disproportionate with our national status and population. According to recent statistics published by China Customs, the China-Canada trade volume only accounted for 1.3 per cent of China’s total trade volume during the first 11 months of 2014. Meanwhile, according to Statistics Canada, exports to China comprise 3.7 per cent of Canada’s total exports while imports from China 11.2 per cent of Canada’s total imports. Both are far behind the numbers between Canada and its largest trading partner – the United States, which are 77 per cent and 54.4 per cent respectively. As a matter of fact, with the largest population in the world, 1.3 billion, China has a huge market, and great potential of demand, for not only energy and resources, but also agricultural, high-tech and service products from Canada. China has invested $54-billion (U.S.) in Canada, 90 per cent of which goes to the energy sector. However, our energy trade only accounts for 1 per cent of the bilateral trade, implying plenty of room for growth. The two countries should work jointly to take potential opportunities and make breakthroughs in energy and resources trade to ensure further growth of bilateral trade in a balanced and healthy way.

Third, facilitate co-operation on major projects in order to add more value to bilateral co-operation. China and Canada have a history of successful co-operation in mega projects. The introduction of CANDU nuclear reactor to Qinshan Nuclear Power Plant has promoted the Canadian export of machinery equipment and technology to China and made China-Canada co-operation lead the way among co-operation between China and Western countries. Three years ago, the acquisition of Nexen Inc. by CNOOC deepened the pragmatic co-operation between the two countries, and made Canada China’s second largest overseas investment destination. This being said, in recent years, the bilateral economic co-operation has been calling for major projects. Both the Asia-Pacific and Chinese markets have huge demands for LNG. Starting LNG trade and co-operation will enable China and Canada to further enhance co-operation in a raft of related areas, such as shipping, shipbuilding, port development and maritime environmental protection. China has accumulated rich experience in infrastructure construction, particularly in high-speed railway, and is enhancing international co-operation through pushing forward the Silk Road Economic Belt and Maritime Silk Road. LNG and high-speed railway should be priorities on our plan for major projects co-operation.

Fourth, strengthen anti-graft law enforcement co-operation and jointly combat corruption. Corruption is the common enemy of the international community. China has launched an unprecedented anti-graft campaign to fulfill social fairness and justice. During his visit to China, Prime Minister Harper made it clear that Canada has no intention of harbouring fugitives, and is willing to collaborate with China in their repatriation. In fact, the two sides have conducted consistent and fruitful co-operation in this regard. China expressed its appreciation. Currently, the two sides have successfully concluded negotiations on the return and share of recovered illegal property, laying a more solid legal foundation for co-operation in law enforcement. Moreover, we are looking forward to purifying the environment for bilateral economic co-operation and people-to-people exchanges by cracking down on fugitives and corrupt officials.

China and Canada differ in political systems and development stages. We are confident that by addressing the differences with wisdom and long-term perspective, we will fully be able to make co-operation the main theme of our bilateral relations.

Luo Zhaohui is the Chinese Ambassador to Canada.

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