China's Potential Impact on Western Canada
Sometimes a rubber chicken dinner is only that, but sometimes it flings open the windows on new insights, as did a small University of Alberta dinner, held in Calgary, that explored the potential impact of China’s expanding economy on western Canada.
Admittedly, China’s economic growth is not a new story, and like most people I have had an ongoing fascination with events in China. However, this casual “tourism of the mind” has not fully come to grips with the sheer magnitude of the new Chinese reality.
Many Canadians still see China primarily as a huge potential market without also seeing China as a major potential investor in Canada. Indeed, the impact of Chinese investment in western Canada may well rival the impact of expanding markets.
There is a also a temptation for western Canadians, who are hard-wired for economic booms and busts, to see China’s current prosperity as a blip rather than a transformative event, to believe smugly that China will be brought back to earth by rural poverty, the demographic repercussions of Mao’s one-child policy, and environmental stress. Recent growth has been so out of line with our experience that it is easy to believe that China is a bubble waiting to burst.
And yet, this bubble is likely to be our enduring reality, and even if it does burst or deflate, the impact on the Canadian economy will be direct and immediate. For this and other reasons, the Harper government has shed its initial coolness to China and is moving to strengthen economic and political ties. Gone are the days when Canadians sat on the sidelines, hectoring and lecturing the Chinese on human rights issues.
We are also realizing that access to China’s markets and investment is much more difficult than we first thought. China’s growing appetite for energy will be immense, but moving land-locked western Canadian energy resources to Chinese markets will not be easy.
Part of the challenge is physical infrastructure, the ports and rail lines we need to connect the West to Asian markets. Although Canada has made some significant strides with the Asia-Pacific Gateway initiative, an effective gateway also implies cultural understanding and language skills. It is about coming to grips with different traditions with roots that go back thousands of years. Effective gateways are as much cultural as they are physical, and cultural understanding must flow both ways.
China’s economic success may even challenge some of our most basic political values, ones that go back to the Protestant Reformation. We believe, and with good reason, that strong liberal democratic institutions foster economic prosperity, that democracies with competitive party systems are the best positioned to succeed. Perhaps, but China is offering the world a different model with considerable success if not principled appeal.
While there is no question that Chairman Mao got so much wrong and so little right, it is less clear that the same condemnation holds for China’s current leadership. There may well be different paths to the same end of economic prosperity.
Of course, we should not be overly Pollyannaish about China’s boom, while keeping in mind that a China in distress will also have dramatic impact on the global and Canadian economies. We can never be certain what the future holds. Nevertheless, if we want a glimpse of the world to come, it is more likely to be found on the streets of Beijing or Shanghai than on the streets of Europe or North America.
Roger Gibbins is President and CEO of the Canada West Foundation. Canada West Foundation is committed to sustainable prosperity in Western Canada, and the only think tank dedicated to being the objective, nonpartisan voice for issues of vital concern to Western Canadians.