Canada wins with improved US-China ties

Canada, which now enjoys significant trade relations with China, will continue to benefit from a growing confidence in the US-China relationship, Canadian Minister of International Trade Ed Fast and University of Toronto professor Wendy Dobson said in remarks ahead of the meeting between Chinese President Xi Jinping and US President Barack Obama in California this week.

Fast, who also serves as Minister-in-Charge of Asia Pacific Gateway, told China Daily that over the past several years, the Canadian government had been aggressively expanding trade and investment ties throughout the fast-growing Asia-Pacific region and is working to deepen partnerships with high-growth markets around the world, including China.

Today, China is Canada's second largest trading partner. Last year, Canada's bilateral trade with China reached a record level of $70 billion, with merchandise exports alone growing by 15 percent. China has surpassed the UK to become Canada's second largest export destination, after the US.

"Making it easier for Canadian businesses to increase their exports to high-growth markets like China is part of our plan to create jobs, economic growth and long-term prosperity for our workers and businesses," Fast said when asked how he sees the Xi-Obama summit affecting Canada's own relations with China.

He said Canada is committed to creating the right conditions for Canadian businesses to compete globally, having recently concluded an agreement with China to provide stronger protection for Canadians investing in China, and facilitate the creation of jobs and economic growth at home.

Dobson told China Daily that the Xi-Obama meeting is taking place at a time when Canada's ties with China are growing and warming up after a frosty period from 2006 to 2009.

She said that like all smaller countries, Canada stands to benefit from improving relations between the US and China and would only get trampled if the two were to fight instead.

Asked what Canada hopes to see achieved by the summit vis a vis the off-and-on strained US-China relations and within the context of a global economy and global cooperation on a host of issues, Dobson said all smaller nations could build on a basic agreement between the two.

"What it all means for Canada-China relations is we benefit from growing confidence between the elephant and dragon," Dobson said. "As a mouse beside the elephant, we understand that with deeper interdependence and rising flows of trade and investment transactions, there are bound to be disagreements and shouting at times.

"That does not mean we are enemies, just that we disagree," she added, "and will stand up for our interests. And the elephant or dragon will have more respect for those who do stand up for themselves."

Dobson said Canada could expect the dragon and elephant to shout and disagree, but with a basis of trust and mutual understanding, which meetings like the summit in California are intended to build, they are less likely to let things get out of hand, or to miscalculate and degenerate into conflict.

As for timing, Dobson said the meeting is the first time since both Obama and Xi had received their new mandates that they could get together.

"They have met on state occasions before, but not at the beginning of their new mandates, which stretch some time into the future," Dobson said.

Beijing under the new leadership of President Xi and Premier Li Keqiang is said to be serious about forging a new kind of relationship with Washington, by first starting to build up mutual trust through the summit.

According to Xi himself, relations between China and the US are at a critical juncture and both sides must now "build on past successes and open up new dimensions for the future", Dobson said.

Since 2009, Chinese leaders and their two foreign ministers have declared their commitment to a new kind of great power relationship in which the rising power and the established power meet, she explained.

"This means they will cooperate rather than become adversaries. It does not mean they will not compete in pursuing their own national interests. But as great powers they will cooperate on collective interests in peace, stability, and a cleaner environment, which no nation, large or small, can do on its own," she said. "We need them to commit to such principles and set priorities for action."

She agreed the US-China agenda is big and complex, with lots of issues to discuss in a relationship that has elements of cooperation and competition.

The American approach to China seems to seek to expand the areas of cooperation in managing regional and global challenges, and managing their differences in a way that prevents disruptive and unhealthy competition from undermining their interests and those of US allies in Asia.

Dobson said it should be no surprise to see a working meeting like Sunnylands scheduled, because it is the right thing to do.

"I hope in the years ahead there will be regular working meetings between the two leaders in which they meet informally," she said.

At first, they need to get to know each other and work out a strategic framework for the relationship and talk through their views and differences on key global issues, especially in relation to such potential flashpoints as North Korea and the East China Sea.

"After all, previous leaders have already done this on Taiwan," she said.

Dobson said both sides have already made foreign policy mistakes on key issues - China in assuming the US is in decline and "bullying" its neighbors in the South China Sea; and the US in over-dramatizing its rebalancing, something which anyone who has followed US strategy has predicted for years would have to happen, and getting stuck in the Middle East, which made no strategic sense.

"Now the leaders need to find ways to leave space for the other in the region that respects core interests," she stressed. "There are other Asia-related issues as well - securing maritime sea lanes, strengthening regional institutions and working out ways to conduct joint military exercises aimed at regional stability."

Other issues are more global in nature: cyber space needs a governing framework where both need to agree in order to lead; the militarization of space and climate change are other matters in need of attention.

"And there are economic issues: how to include China in free trade agreements in Asia? How to generate more welcoming environments for foreign investors in both countries?" Dobson said.

Fast, who recently visited China on a trade mission to promote Canadian trade and investment interests in Hong Kong, Harbin, Beijing and Tianjin, said e+ orts to deepen Canada's trade and investment ties in Asia-Pacific are being facilitated by strategic investments and partnerships.

Since 2009, Canada has opened six new trade offices in China (Chengdu, Nanjing, Qingdao, Shenyang, Shenzhen and Wuhan), which demonstrates the importance Canada places on establishing closer relations with emerging centres, in addition to enhancing Canada's ability to support Canadian companies in China, according to Fast.

"Since 2006, our government has invested $1.4 billion in Asia-Pacific Gateway infrastructure projects, an amount that has been leveraged to almost $4 billion with the participation of provincial and municipal governments and the private sector," he said.

Beyond boosting trade and investment throughout the Asia-Pacific region are the strong people-to-people ties that are taking relationships to the next level, Fast said, adding that Canada's more than 1.4 million Chinese-Canadians "enrich every aspect of our country, and the government will continue to grow these crucial cultural links and friendships throughout the region".