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Canada to bide its time on progress with China, Ottawa signals

The new Chinese ambassador to Canada, Lu Shaye, told The Globe and Mail that Beijing was seeking unfettered access by Chinese businesses, including state-owned enterprises, to all sectors of the Canadian economy. The Liberal government has not indicated that it would allow Chinese firms access to proprietary technology and other assets that could compromise national security.

Blair Gable/Photograph by Blair Gable

China should not expect rapid progress on a comprehensive extradition treaty with Canada, or on a free-trade agreement, the Liberal government indicated Sunday.

Instead, Ottawa will employ a policy of strategic patience, while carefully watching how Beijing deals with the new administration in Washington, a senior government official said on background. Representatives of the two countries meet next month to explore the possibility of launching formal free-trade negotiations.

"Promoting and protecting human rights is an integral part of Canada's foreign policy and remains an unwavering priority for the government," Alex Lawrence, a spokesperson for Foreign Affairs Minister Chrystia Freeland said Sunday by e-mail. "Canada engages regularly with its Chinese counterparts on a number of issues, including those related to human rights."

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The statement came in reaction to a Globe and Mail story that revealed the Chinese government employs torture to extract confessions from people arrested on corruption charges, or to punish those who campaign for human rights. As long as China continues such practices, the official said, hopes for a comprehensive extradition treaty with Canada have little chance of success.

Read more: Shuanggui: The harsh, hidden side of China's war on graft, and how one man disappeared into it

Read more: Beijing pressing for full access to Canada's economy in trade talks

In free-trade talks, the Liberals are signalling that they are unlikely to accede to a key Chinese demand.

The new Chinese ambassador to Canada, Lu Shaye, told The Globe and Mail that Beijing was seeking unfettered access by Chinese businesses, including state-owned enterprises, to all sectors of the Canadian economy. Stephen Harper's Conservative government, while approving one acquisition by the state-owned CNOOC of the Canadian energy firm Nexen, otherwise prohibited Chinese acquisition of Canadian firms operating in Canada's oil sands.

The Liberal government has not indicated that it would allow Chinese firms access to proprietary technology and other assets that could compromise national security.

Both Ottawa and Beijing may be offering these public positions as bargaining ploys as they prepare for the April talks.

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Most trade observers agree that a free-trade agreement with the world's second-largest economy would be in Canada's interest.

"It's a complicated relationship, but we can't afford to ignore this challenge, we can't sit on the sidelines," said Roland Paris, who teaches at the Graduate School of Public and International Affairs at University of Ottawa. Prof. Paris was also Prime Minister Justin Trudeau's foreign policy adviser for a time.

China's economy is growing at three times Canada's rate, and its expanding middle class offers major opportunities for Canadian businesses.

Canadian farmers see opportunities to greatly increase exports of everything from grains to beef; the natural-resource sector would benefit; enterprising manufacturers would welcome a shot at tariff-free access to a market of 1.3 billion people, while financial services would also like to expand their footprint.

But there are limits to how far Canada can co-operate with China because of the country's authoritarian government, low regard for human rights and tendency to blur the line between private enterprise and state ownership.

It took 10 years for Australia and China to negotiate a trade agreement. The Liberals expect that Canada-China talks will also take a number of years to conclude, and are likely to stretch on well past the next election. One proposed approach that has been put forward by Kevin Lynch, former clerk of the privy council, and others would see the two countries conclude sectoral agreements as a lead up to a full FTA.

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China faces an uncertain relationship with the White House under President Donald Trump, who accuses the country of currency manipulation and other tactics that encourage Chinese exports into the United States while limiting American exports to China, and who is threatening to impose a tariff wall in retaliation.

Chinese President Xi Jinping visits Mr. Trump at his Mar-a-Lago estate in Florida next month.

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About the Author
Writer-at-large

John Ibbitson started at The Globe in 1999 and has been Queen's Park columnist and Ottawa political affairs correspondent.Most recently, he was a correspondent and columnist in Washington, where he wrote Open and Shut: Why America has Barack Obama and Canada has Stephen Harper. He returned to Ottawa as bureau chief in 2009. More

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