Susan Gong is founder and CEO of Altec Global Capital Inc., a Canadian firm that helps facilitate business between Chinese and Canadian companies. She has participated in four trade missions to China with Ontario premiers in the past decade, and is a former member of the Immigration and Refugee Board.
During his visit to China, Canadian Prime Minister Justin Trudeau has put a fitting focus on soft power. He is building relationships and playing the long game. This is not only wise, it is a concept in business very familiar to China.
In China, business is a personal affair. Business is more than a simple commercial transaction; it is social. In the West, we are familiar with networking, but treat it almost as something of a chore. However, in China, the concept of guanxi guides business transactions, and Mr. Trudeau has approached his trip to China in a manner consistent with the concept.
Put simply, guanxi is similar to the Western system of networking, but is both more familiar and more based in notions of honour, mutual respect and shared benefit. It has an element of trust and dignity.
Mr. Trudeau has shown an implicit understanding of this concept through simple yet meaningful ways. Some commentators remarked in advance of his trip that historical connections – such as physician Norman Bethune or Mr. Trudeau's father opening diplomatic relations in the 1970s – are mere fond memories, that China takes a practical and to-the-point type of transactional stance in bilateral relations. This is true, to a point.
But it is also commonly understood that in China, the hierarchical nature of business means that oftentimes it takes an intervention by a senior figure in government to move files forward, even in business. That is why it is critical to have senior Canadian leaders nurture and utilize relationships with their Chinese counterparts to facilitate business. Mr. Trudeau's personal history with China is not a mere historical fact. It is still something appreciated as a means of identifying Mr. Trudeau himself with guanxi.
Mr. Trudeau knows this, and has approached his trip to China in a manner that suggests an implicit understanding of the need to develop guanxi.
For instance, in China, family matters. It was something of a subtle masterstroke that Mr. Trudeau posted a photo of his young daughter, Ella-Grace, jumping into his arms meeting Chinese Premier Li Keqiang. It was more than a delightful photo; it also was also a reflection of his own connection to China through his father and it was a sign of appropriate familiarity. Our ambassador to China noted as much, commenting that the Trudeau family having dinner with the Premier at the Forbidden City Tuesday night was "unprecedented."
Similarly, the signing ceremony for a deal around national parks was more than a feel-good moment and picturesque photo op atop the Great Wall. It showed a meaningful way to help support each other; it is no secret that Chinese companies are particularly interested in Canada's environmental bona fides and this synergy is one to be further explored.
Indeed, the Prime Minister even went so far as to argue in a business luncheon that closer ties with Canada would "help China position itself in a very positive way on the world stage." In this sense, one can see guanxi at work because the concept is rooted in a sense of reciprocity.
Perhaps more substantially, joining the Asian Infrastructure Investment Bank brings the two countries closer together economically, and the Chinese are pleased to have Canada on board with the bank.
Any closeness with China is also the best means to advance Canadian values. By first building a sense of familiarity, Mr. Trudeau gains the standing to push forward on bilateral irritants and consular concerns in a far more robust manner.
In that respect, our Prime Minister is playing the long game. He effectively used this first trip to build a positive working relationship. With this rapprochement now in place, and the commitment to yearly meetings, the real tests will come, but based on a foundation of respect rather than tension.