Translation of Interview Published in Ming Pao

Scholar Hopes that Increase in Mutual Trust Will Encourage Signing of ADS and Improve the Trade Imbalance

[Note: This interview came out in Ming Pao on June 22. http://www.mingpaotor.com/htm/News/20100622/taa8.htm It is also available at http://news.newstarnet.com/gb/MainNews/NorthAmerica/2010_6_22_8_31_38_583.html. The reporter misunderstood me with regard to the FIPA. My views on this are accurately represented in my recent op-ed published in the Toronto Star and reprinted in other Canadian English-language press: (http://www.thestar.com/opinion/editorialopinion/article/824570--economic-titan-china-needs-to-act-like-a-leader)]

[Ming Pao Special Report] This years marks the 40th anniversary of the establishment of diplomatic relations between Canada and China. Charles Burton, Associate Professor of Political Science at Ontario's Brock University who has served two postings as Counsellor at the Canadian Embassy in Beijing indicated that he hopes that Canada and China will formally sign an "Approved Destination Status" (ADS) agreement and a "Foreign Investment Protection Agreement" while Chinese President Hu Jintao is on an official visit to Canada this week. Moreover he hopes that there will be progressive building of mutual trust between the two nations which will lead to Canada-China relations entering into a new stage of development.

Burton was a student at Fudan University in Shanghai and from 1991 to 1993 and from 1998 to 2000 was Counsellor for Cultural Affairs and Counsellor for Political Affairs at the Embassy of Canada to China. Presently he is an associate professor of Political Science at Brock University in Ontario who has been engaged in the study of Chinese politics and Canada-China relations for many years. He is a scholar-diplomat China affairs specialist. He has written many reports on Chinese affairs for the Federal Department of Citizenship and Immigration, the Department of Foreign Affairs and International Trade and the Canadian Security Intelligence Service.

For example, in February of last year Burton published a report entitled A Reassessment of Canada's Interests in China and Options for Canada's China Policy. It systematically and penetratingly analyzed relations between Canada and China in the areas of trade and investment, immigration and consular matters, development and human rights, Taiwan, Tibet, Uyghur, Mongolian issues and Falun Gong issues as well as public diplomacy, etc. The Report makes recommendations on how to improve Canada-China relations.

Widening of the trade imbalance and the lack of success of Chretien's China Policy
Burton in his exclusive interview with the Ming Pao gave his analysis of the past Federal Liberal Government and the present Federal Conservative Government's China policies. He believes that the China policy of the federal Liberal Party under the Chretien Government was not successful. This is because the previous Liberal Government emphasized strengthening Canada-China trade relations and adopted a quiet approach to China's human rights situation. In the end China's human rights's situation did not improve and Canada's trade deficit with China got worse and worse year after year.

In the early period of the Federal Conservative Party's new Government, because Prime Minister Harper had not had the experience of being in Government previously, and because the Conservative Government was in a minority position in Parliament which meant that the domestic political situation was uncertain, Mr. Harper had no choice but the focus his attention on domestic affairs. So he had to neglect foreign affairs. Not only did he not visit China, but he also was unable to visit other countries undergoing rapid economic growth such as Russia, Brazil and India.

Now that the domestic political situation is less subject to change, Mr. Harper in recent years has repeatedly made foreign visits. These include his official visit to China in December of last year. In addition, to promote the the development of trade between Canada and China the Conservative Government has established several new consulates in China.

Beijing readjusts its policy toward Canada and increase in investment by Chinese companies
Burton believes that the coming to an understanding with Chinese President Hu Jintao on signing a "Approved Destination Status" Memorandum of Understanding when Mr. Harper visited China last December indicates that the Chinese Government has readjusted its policy to Canada. This is because the Chinese Government perceives that the Federal Liberal Party cannot return to Government in the short term. So the Chinese Government is now prepared to actively cooperate with the Conservative Government. One factor in this is that the Chinese Government does not want cool relations between Canada and China to negatively impact on the Chinese enterprises who are more and more coming to invest in Canada.

With regard to Chinese President Hu Jintao's official visit to Canada set to begin tomorrow, Burton hopes that Canada and China can officially sign an "Advanced Destination Status" (ADS) Agreement and a "Foreign Investment Protection Agreement." He also hopes that the two countries can continue to build more mutual trust between each other.

He indicated that many Canadians are extremely concerned about human rights in China. Therefore when Mr. Harper raises the issue of human rights with Hu Jintao it should be with a high degree of transparency in encouraging China to repect the UN Human Rights Covenants. At the same time Mr. Harper should enourage China to adopt a more responsible approach to China's participation in international affairs. In this way China can play an important role in promoting global economic development and preserving world peace.

For example, China should take a more active role in resolving the problem of North Korea. China is the only nation with influence over North Korea. Moreover it will be of benefit to China to resolve the North Korea problem Burton addressed the outlook for future development of relations between Canada and China. He in particular looked at the tendency of the trade imbalance between Canada and China to become more and more pronounced in recent years and the problem of Canada continuing to lose market share in China.

According to statistics cited in his report A Reassessment of Canada's Interests in China and Options for Canada's China Policy, in 2006 China exported $34.5 million in products to Canada but Canada only exported $7.7 billion worth of products to China in that year. The trade deficit reached $26.8 billion. So the current trade imbalance of Canada to China is 1 to 4. That is to say that for every $100 in products that Canadian imports from China, Canada only exports $25 in products to China.

According to Burton's analysis there are many factors contributing to the serious problem of the trade deficit widening year by year. These include: China's currency policy, China's weak protection of intellectual property and the lack of comprehensive rule of law in China, and the long delay in not signing a "Foreign Investment Protection Agreement" etc.

Lack of support by Canadian agencies in China for Canadian firms seeking to penetrate the Chinese market 
But he also acknowledges that Canadian enterprises in their approach to the Chinese market lack a spirit of being willing to take risks and persisting in pursuit of their goals. In this regard that Canadian enterprises cannot be compared with enterprises from Australia and the U.S. and other countries. In addition another factor is that Canadian business people in China often do not enjoy strong support from Canadian trade promotion agencies in China.

Burton indicated that the U.S. and Australian trade promotion organizations in China are very active with their constituent elements well-coordinated . So they are able to provide a lot of support for their nations' business enterprises in China. In sharp contrast the Canadian government trade promotion agencies lack coordination and lack definition of their respective functional responsibilities between Federal Government and Provincial Government agencies. In addition Canadian Trade Commissioners sent to China don't speak Chinese and lack understanding of the special nature of the Chinese market and of China's business culture. The trade promotion programming also tends to be unresponsive to change in China and so is out of date.

He therefore recomends that the Government of Canada articulate a clear statement of its China trade strategy so as to make progress in getting Canadian enterprises to enter the Chinese market. This strategy should pay close attention to the distinctive characteristics of the Chinese market and its business culture. It should define Canada's strengths in the Chinese market vis-a-vis Canada's competitors there. And it is important that there be better coordination of the activities of various Canadian trade promotion organizations and agencies in China.