Reflecting on Canada-China Ties: Alignment of Philosophy or Interests?

On January 19th, Canada’s top envoy to Beijing, Ambassador John McCallum, noted that on many fronts Canada is now more closely aligned with China than it is with the United States. 

“In some important policy areas such as the environment, global warming, free trade, globalisation, the policies of the government of Canada are closer to the policies of the government of China than they are to US policies,” McCallum stated, as reported by the Globe and Mail.

Reactions to the statement were mixed.  McCallum later clarified that “the United States relationship is by far and away the most important.”

Prime Minister Justin Trudeau takes part in the "Eye-Dotting" ceremony as part of a lunar new year celebrations with Liberal members of parliament, supporters, and community leaders, in Markham, ON, Canada on Thursday, February 15, 2018.[Photo: dfic.cn]

The Canada-China relationship is an important and a special one, but is the recent warming driven by a fundamental shared vision or a short-term alignment of interests?

Canada, like much of the world, is in a stage of transition. President Trump’s “America First” populism has been juxtaposed by Canadian Prime Minister Justin Trudeau’s own brand of populism – a vision of Canada as progressive, open, and an important participant in global governance. And embracing global governance means embracing a close relationship with China.

In broad terms, the two countries are more aligned than ever issues such as the promotion of free trade, climate change, and sustainable development. They are aligned against the worldwide anti-globalization trend. 

But there are differences in their approach, as well. Canada’s message at the World Economic Forum’s gathering in Davos was to maintain course with the liberal world while nudging toward improvements on the labour, gender, and environmental fronts. China’s vision, while also built on global cooperation, ties these goals with a gradual reordering of the world’s economic systems around China, as evidenced by the Belt and Road Initiative, and the Asia Infrastructure Development Bank (AIIB). As Canada seeks to reinforce its influence on the liberal world order, China seeks to make its own additions to global governance.

China’s transformative Davos vision of “a community with a shared future for all humanity” is more attune with Canada’s interests than the United States’ turn toward economic nationalism. But Canada has appeared committed to a third path. It has balanced joining programs such as the AIIB that has been balanced with commitment to the TPP. But commitment to international cooperation allows for differences in approach, and this is a founding principle in the Canada-China relationship.

Why all the noise now? Because the Canadian government has a sense of urgency. McCallum’s statements on China came at the same time as Canada unveiled ideas to save the North America Free Trade Agreement and as Trudeau lobbied major U.S. firms during the penultimate round of renegotiations for the treaty. Other longstanding US-Canada trade disputes have surfaced over the past year, including dairy and softwood lumber. 

And so over the short term, building the trade relationship with China has provided an outlet for a Canadian government facing a more protectionist United States. Exploratory talks on a Canada-China Free Trade Agreement first took place April 2017 and have been a priority for the Trudeau administration. They took centre stage during Trudeau’s 5-day trip to China in December, during which he stated “Canada is and always has been a trading nation. But the landscape of trade is shifting and we need to adjust to it.” But these talks are still early; the Australia-China free trade agreement took 10 years to negotiate, and was much less ambitious.

In the mean-time, China and Canada have engaged in tit-for-tat moves to strengthen economic relations. China has eased restrictions on Canadian beef imports, and the Canadian government has approved the purchase of several large Canadian firms by Chinese investors, most notably the acquisition of Norsat International Inc, a company with military customers including the Pentagon and Canadian Coast Guard, by Hytera Communications from Shenzhen, China. The acquisition of Canadian infrastructure firm Aecon by China Communications Construction Co. (CCCC) is currently being debated. While such acquisitions are nothing new, the previous Canadian government blocked similar deals over national security concerns. Trudeau’s government has demonstrated more trust toward Chinese firms. While China’s investment in Canada is often exaggerated in media and political debate, this year it is certainly accelerating.

So what does it mean that Canada is more like China than it is the United States? It means that the two countries are aligned on issues such as trade, the environment, and global governance. It also means that there is a new urgency to building their relationship, particularly from the Canadian side. Faced with new uncertainties and shifting global economic power distributions, it is a path of stability and opportunity.

(Brady Fox is a Canadian expert on Asia Pacific affairs.)