IN THIS EDITION: Canadian agriculture feels the pain, China’s new ambassador to Canada starts, and the 70th Anniversary of the People’s Republic of China.

“What is needed next, and what has been lacking for decades, is a measured, principled, and forward-looking China strategy that is complementary to the efforts of our key allies.” – Charles Burton, the Western Producer

Agriculture feels the pain

At the Global Business Forum in Calgary, Jonathan Manthorpe (author of Claws of the Panda) said that Canadian farmers can no longer depend on China, and that Canada should focus its ambition in Asia on places like South Korea, Japan, and Taiwan instead. Another speaker at the Forum, former Canadian ambassador to China Guy Saint-Jacques said that Canada is not as important to China as a supplier as it once was, and that means trade with China will remain unpredictable. (He did also note that the agriculture story with China hasn’t been all bad this year – wheat exports to China hit a 14-year high.)

• This Western Producer piece argues that Canadian farmers are being hit by trade disputes more generally, including and going beyond China, and argues that Canadian farmers are losing ground to American farmers, because American farmers are being compensated through the trade turmoil. Canadian farmers, largely, are not.

Farming is one of Canada’s industries that actually pays-in to the national coffers, providing export earnings to the economy at large and taxes to the federal and provincial pots. Its health and growth is vital for the future of all Canadians. But what happens when farmers are left to suffer unfair losses, like those imposed by trade politics? … Farmers will hold back from investing in their farms. They won’t launch new businesses. They won’t enter new industries. Opportunities will be spurned. The farm economy will stagnate.”

• The Globe and Mail did a long feature on the dispute with China, for which I was interviewed, and I came to a similar conclusion about agriculture and China as the above pieces:

Some experts say Canada has very little leverage over China. The argument is that China has other supply options for much of what Canada sells here. Meanwhile, introducing new tariffs on Chinese goods would make such a small dent in China’s factory output that it would barely register. … The bottom line: Canada needs China but China doesn’t need Canada, said Sarah Pittman, a policy analyst with the Canada West Foundation. “It’s such a mismatch,” Ms. Pittman said. “They’re still going to need what we produce. But they don’t necessarily need us to produce it.”

Not everyone came to the same conclusion – it’s worth reading the whole piece if you have access, it’s particularly in-depth. The issue is nuanced, and several factors can play a role, such as the crop in question and global circumstances (CWF colleagues Carlo Dade and Sharon Sun have previously looked at pork,  the role of Canada’s new multilateral trade agreements,  and why Canada needs to do better at managing risk in China, for example.)

Cong Peiwu starts as ambassador of China in Canada

Cong Peiwu, China’s new ambassador in Canada, officially started his tenure, filling the seat left vacant by Lu Shaye.

• He has experience in Canada, having previously worked at the Chinese Embassy and being head of the North American Affairs desk for the Chinese Foreign Ministry.

• While it’s still early days in the new role, this move seems to have generated sparse media coverage for a figure who could potentially play an important role in Canada’s engagement with China. We’ll continue to monitor.

US and Canadian Rare Earth Plan

• A joint plan between Canada and the US discusses how to ensure reliable supply of rare earth elements. The market is currently dominated by China.

• Prime Minister Trudeau and President Trump discussed the issue during their last meeting.

• The last China Brief discussed the business case for rare earth development in Canada.

Other stories:

• The 70th anniversary of the People’s Republic of China was celebrated October 1. Check out this special edition of the Asia Pacific Foundation’s newsletter, which covered the anniversary from several angles.

• Calgary-based Melius Energy has shipped 130 barrels of neat bitumen (similar in consistency to a hockey puck) on a vessel destined for a refinery in China – in what this article calls the latest effort by the energy industry to avoid congested export pipelines and find new ways to export more oil sands crude.

• This op-ed, published in the Globe and Mail, argues that Canada has some advantages economically over China, and that China has economic weaknesses – this means that Canada is able to counter China’s “economic coercion” without fearing too much damage in return.

• Our research at CWF suggests otherwise – that retaliating against China in the manner suggested in the article would damage the Canadian economy. (For more about damage to particular industries, look at this piece on canola.)

• The executive of Canadian National Railway (CN) said that the U.S. -China Trade War is hurting the railway – he said volumes and revenue have both slumped as a result.

• Last China Brief, we discussed Taiwan’s efforts to join discussions of the International Civil Aviation Organization’s (ICAO) in Montreal, whose efforts China was trying to block. The ICAO conference was held two weekends ago, and Taiwan was barred from participating – it set up side meetings a few blocks away.

• This piece discusses FortisBC’s breakthrough LNG contract with China, signed a few months ago – and why it has failed to generate any popular/media discussion.

• This piece looks at how the current tensions between Hong Kong and Mainland China have made their way around the world through expat communities – such as in Vancouver.

– Sarah Pittman, 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.