DOES TRUDEAU REALLY BELIEVE TRADE WITH CHINA IS ‘FREE’?

DOES TRUDEAU REALLY BELIEVE TRADE WITH CHINA IS ‘FREE’?

Lu Shaye says journalists paint a negative picture of China's human rights record.
Dec 1 2017UPDATED DECEMBER 1, 2017

Charles Burton is an associate professor of Political Science at Brock University in St. Catharines, Ont., and is a former Counsellor at the Canadian Embassy in Beijing

Last Sunday afternoon, while Canadians settled in for the Grey Cup game, the Prime Minister's Office announced that Justin Trudeau will fly to Beijing this weekend for talks about "a progressive trade agenda" as well as "frank dialogue on human rights issues like good governance, freedom of speech and the rule of law." Frank dialogue on human rights? 

The federal Liberals are dreaming if they think skeptical Canadians will buy the official line on Mr. Trudeau's sudden visit to China.

Beijing has made clear it will not abide aspirations of a "progressive trade agenda." Inserting clauses on human rights, the environment or regulatory transparency into free-trade talks is a non-starter. This regime demands that Canadian companies operating in China transfer technology and intellectual-property rights to their Chinese state partners. A free-trade agreement (FTA) won't change that. No such "progressive" conditions appear in FTAs with New Zealand or Australia. Why would Beijing give a minor global player such as Canada special consideration?

Ottawa's report this year on the "Public consultations on a possible Canada-China FTA" has a long list of concerns cited by businesses who have had arbitrary taxes, import duties and "new" internal regulations imposed on them as their Chinese state partners squeezed them out of the Chinese market. The report strongly contradicts Mr. Trudeau's optimism that a China FTA will benefit Canada and should be taken seriously.

Beijing is unyielding that non-economic factors have no place in trade deals. If Canada wants enhanced access to China's market, it must toe Beijing's line on non-contact with Tibet's Dalai Lama; stay silent about threats to democracy in Hong Kong or Taiwan; drop objections to China's development of military facilities in international waters of the South China Sea; and submit to Chinese espionage in Canada and ever-increasing reports of aggressive menacing of Canadian citizens of Chinese origin to get them to serve the interests of the "motherland."

So, what more does China hope to get in an FTA? It already has excellent access to Canadian markets, thanks to low Canadian tariffs under the WTO, and Canada's fair and transparent import and investment regimes. Will Ottawa cave to demands of opening our energy and mining sectors to unfettered acquisition by Chinese state firms, if it will not lead to Canada getting reciprocal access to Chinese assets (which it won't)?

Moreover, the putative benefits to Canada of free trade are underpinned by Beijing's rhetoric on "building trust." There is ample precedent that China's adherence to international trade deals has not been trustworthy, from recent harsh restrictionsplaced on Australian coal when it began capturing a bigger share of China's market, to devastating restrictions placed on South Korea's Lotte Corp.'s operations in China, after South Korea allowed the United States to install an anti-missile defence system against Chinese protests. Then there's China's threats to effectively ban Canada's significant sales of canola seeds, which certainly hasn't stopped us from transferring high-tech applications to the Chinese military.

Once producers become dependent on the Chinese market, an asymmetrical power dynamic comes into play. The demonstrated fact is that China simply does not deal in good faith, and there is no basis for confidence that China will comply with the norms of international commerce. Contrast this with the lack of political concessions that Canada has had to make as a consequence of our economic dependence on the U.S., which has not used its economic power over Canada to coerce our accepting missile-defence systems on Canadian soil, or forcing Canada's participation in U.S. military actions abroad. Washington has not compelled us to sell Canadian water to the parched Midwest and California, or used economic menace to induce Canada to let U.S. multinationals start mining in environmentally sensitive areas of the Canadian North.

China has no qualms whatsoever about fully leveraging economic dependence to serve its overall geopolitical goals throughout the world, including Canada.

Trudeau would represent Canada best if he gave China a frank review of the reasons why we cannot commit to free trade with a non-transparent, state-directed, duplicitous and corrupt economic regime. He should also brief his Chinese hosts on Canada's "Justice for Victims of Corrupt Foreign Officials Act (Magnitsky Law)" that came into effect in October. Recently, 19 Venezuelan officials joined the list of Russians and South Sudanese on the Canadian Magnitsky sanctions list because, as the government explains, they are "responsible for, or complicit in, gross violations of internationally recognized human rights, have committed acts of significant corruption or both." Presumably the same criteria applied to Russia and Venezuela will shortly be applied to larger numbers of Chinese officials. Or does China free trade trounce that, too?