IN THIS EDITION:  50th anniversary of China-Canada diplomatic relations, trade doing well, barley and pork update

We have decided to make the Spotlight question a permanent feature in the China Brief. We welcome suggestions for questions to pose to experts on issues in the Canada-China relationship that impact the West.

Email your questions – we will consult our network and publish the answers in an upcoming brief.

50th Anniversary of China-Canada Diplomatic Relations

Current tensions marred the 50th anniversary of Chinese-Canadian diplomatic relations. At a dinner for the Canada-China Business Council annual general meeting in Beijing, Wang Shouwen, China’s Vice-Minister of Commerce, received applause as he called for Meng Wanzhou to come back to China. When Canada’s Minister of Small Business, Export Promotion and International Trade made the same call for the return of the two Michaels and clemency for Robert Schellenberg, who was sentenced to death, the room was silent. The vice-minister also spoke to the benefits of a free-trade agreement with Canada, talks from which Canada has recently walked away.

When asked about the 50th anniversary, Prime Minister Justin Trudeau stated “We will continue to work with China for advancing Canadian interests and Canadian producers. At the same time, we will remain absolutely committed to working with our allies to ensure that China’s approach of coercive diplomacy, its arbitrary detention of two Canadian citizens, alongside other citizens of other countries around the world is not viewed as a successful tactic by them.” The Chinese government condemned the use of the phrase coercive diplomacy.

For more on Chinese-Canada relations over the years, check out this article from the Asia Pacific Foundation and their Asia Watch newsletter.

Trade doing well

Despite tensions, Canada’s share of global merchandise trade that went to China reached 6.9 per cent this year; the highest share on record. Oil trade with China has helped to offset fewer exports to the U.S.; the U.S. has a surplus as a result of Americans working from home and less travel. TSX futures also rose as Chinese crude oil imports were up 2.1 per cent in September.

As China and other countries stockpile with the second COVID-19 wave, food prices are on the rise. Canadian farmers could be well positioned to profit from these prices; reports for this year are positive due to an early harvest, strong yields and crop quality.

Barley and pork update

A previous brief included a report on China’s corn shortage with experts predicting Canadian barley would help fill the gap. New numbers show that may be the case, as the start of the new export year has seen 409,600 tonnes of barley globally exported over 157,800 tonnes the previous year, with China the top buyer. Some estimate that China has converted 18.7 per cent of hog corn rations to wheat and barley. It is not clear how long China’s barley demand will remain. CWF’s Director of Trade and Investment wants to know: are field crop producers and grain companies following the example of their softwood lumber colleagues in their response to non-tariff barriers?

In another brief, there was a report on how China was actively rebuilding its pork supply due to African Swine Fever (ASF). At the annual Meat Import Council of America conference, attendees were updated on China’s pork recovery efforts; experts estimate that Chinese herds are now within 10 per cent of pre-ASF levels. The conference also provides some interesting data and projections on COVID-19 recovery for the meat sector globally. Read the full conference overview here.

Rapid change in sentiments towards China

The pandemic caused turmoil in the economic, trade and diplomatic spheres, resulting in rapidly changing predictions. Headlines from a few CBC articles over the past few months reflect this disruption in terms of China. In April, the CBC published an article with the headline China’s economy in worst downturn since ’70s amid coronavirus battle. On October 2, the CBC published an editorial with the headline Pandemic is an opportunity for Canada to reduce economic dependence on China. On October 19, the BBC published an article with the headline China’s economy continues to bounce back from virus slump.

Everything Else

• Chinese President Xi Jinping has reportedly told his troops to prepare for war over Taiwan as the U.S. moves forward with sales of advanced weapons systems to the island. Some see the move as an intimidation tactic rather than invasion preparation as a war could detract from China’s economic gains and efforts to compete with the U.S.

• The Chinese economy grew 4.9 per cent in July-September 2020 over the same time period in 2019. Retail sales are particularly promising as they were up 0.9 per cent over July-September in 2020 compared to 2019.

• Canada’s Ambassador to China, Dominic Barton, met virtually with the two Michaels as well as Robert Schellenberg. This consular access was the first for detainees since January as China cited the COVID-19 pandemic as prohibiting consular visits.

• Conservative Party Foreign Affairs Critic Michael Chong called out the length of time that the detainees had to wait for consular access and did not see COVID-19 as a legitimate excuse.

• Chinese Ambassador to Canada, Cong Peiwu, and Canadian Foreign Affairs Minister François-Philippe Champagne disagree over Canada potentially granting asylum to those fleeing Hong Kong. The Chinese Ambassador has warned Canada that the country should not interfere while the Foreign Affairs Minister responded to say that Canada will always stand for human rights.

• China is not de-globalizing but rather de-Americanizing according to a recent piece in Foreign Affairs. The article discusses how China continues to see the U.S. as in decline and what the U.S. government can do to reverse that perception. This piece raises interesting questions for Canada.

• Also, from our trade and investment centre director, China aired the first NBA game in over a year, since the Houston Rockets General Manager tweeted support for protestors in Hong Kong. The Chinese-state broadcaster aired game five of the NBA finals and noted that the NBA had recently provided COVID-19 relief assistance to China.

Stephany Laverty, policy analyst

The China Brief is a compilation of stories and links related to China and its relationship with Canada’s West. The opinions expressed in the links are those of the articles’ authors and don’t necessarily reflect the views of the Canada West Foundation and our affiliates.