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The Globe and Mail

Canada won’t rush into free-trade deal with China, minister says

Canadian Prime Minister Justin Trudeau is greeted by Chinese President Xi Jinping during the official welcome at the G20 Leaders Summit in Hangzhou, Sunday, Sept. 4, 2016.


Trade Minister François-Philippe Champagne says the Trudeau government will not be rushed into concluding a bilateral free-trade deal with China even as Ottawa insists no decision has yet been made on whether to start formal negotiations with the world's second-biggest economy.

Prime Minister Justin Trudeau travels to Beijing this weekend for talks with China's top leaders that many in the business community expect could kick-off formal free-trade negotiations.

Canada and China have been in exploratory talks for some time, and Beijing is pressing hard to begin formal discussions. China, which has trade pacts with only a few countries, is keen to score its first trade deal with a member of the Group of 7 wealthy industrialized countries.

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In a speech to the Toronto Region Board of Trade on Thursday setting up the China visit, Mr. Champagne said Ottawa is still "weighing the challenges and opportunities" of entering into a bilateral trade arrangement with China.

"We have been clear from the start with our Chinese friends, throughout the exploratory talks, that should we move forward, this will take time," he said. "Time that we will use to understand the needs and concerns of Canadian workers and families."

The Liberal government recently released the results of consultations with more than 600 businesses, academics and civil-society groups.

They said a free-trade deal with China could kill Canadian jobs, including in manufacturing, and force Canadian firms to compete against companies that have lax labour standards, lower environmental requirements and state subsidies.

A spokesman for Mr. Champagne said no decision has been made on whether to pursue such negotiations, even though many believe Mr. Trudeau is going to China to announce formal talks.

"No assumptions should be made about next week," communications director Joe Pickerill told The Globe and Mail. "We are still weighing the complexity of the challenge, the scale of the opportunities to create jobs and the realities presented by a market like China."

Mr. Champagne acknowledged the challenges that would be posed in launching free-trade talks with an authoritarian country that does not respect the rule of law and closes huge areas of its economy to international competitors. China's envoy to Canada, Lu Shaye, has laid out tough conditions, saying Beijing wants Canada do away with national-security reviews of proposed Chinese takeovers of Canadian companies and to allow its state-owned enterprises to invest in broad sectors of the Canadian economy. China also objects to Canadian criticism of its human-rights record.

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If talks do go ahead, Mr. Champagne assured Canadians the government would not make compromises.

"Canadians expect us to be resolute and steadfast in the promotion of our values abroad, in preserving and protecting our national security, and all the while growing our economy," he said. "We must see the entire chessboard and plan our moves accordingly."

In a statement announcing the trip, Mr. Trudeau's office said the Prime Minister intends to continue frank dialogue with China on topics such as human rights and good governance.

The Canadian Coalition on Human Rights issued an open letter to Mr. Trudeau on Thursday that listed 16 prisoners in China who are either Canadian citizens or have strong connections to Canada.

Among the cases are those of Huseyin Celil, a Uyghur imam imprisoned since 2006, and Qian Sun, a Falun Gong practitioner in jail since February of this year. Mr. Trudeau is also being urged to demand the release of John Chang and Allison Lu, two British Columbia wine merchants charged in a dispute over customs duties.

In his speech, Mr. Champagne said China, with a population of more than one billion and a rapidly expanding economy, represents enormous opportunities for Canadian businesses.

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A study by the Business Council of Canada puts the value of a Chinese trade deal at $7.8-billion in new economic activity for Canada.

"There is over $90-billion in annual bilateral trade between Canada and China and that is poised to double again by 2025," said Mr. Champagne, who noted that China is the second-largest trading partner of six provinces.

The House of Commons Foreign Affairs committee is in China now on an official trip and its chairman says it is time for many Canadians to overcome their reservations toward China, and for Mr. Trudeau to formally announce that substantive trade talks ought to get started.

"The sooner Canadians get to know China a lot better than they do, then some of the myths out there will dissipate simply because China is a more modern society than people think," Liberal MP Robert Nault told The Canadian Press before his arrival in Beijing this week.

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