The prime minister is right that we should not capitulate to China and free Meng Wanzhou, CFO of telecom giant Huawei, held on extradition charges in her Vancouver mansion, in exchange for Michael Kovrig and Michael Spavor, brutally imprisoned in China on bogus charges of espionage. Although the Michaels and their families are suffering terribly, we cannot raise the white flag — both as a matter of principle and because it would expose other Canadians to hostage diplomacy and kidnapping.
The current debate should lead to a broader examination of China’s global assertiveness, how it presents itself to the world and the urgent need for Canada to stop acting like a punching bag and start punching above our weight.
An unsettling political and economic conflict has intensified between the world’s two largest economic powers. On one side is the United States, Canada’s closest neighbour, biggest trading partner and long-time ally — a free-market democracy that respects individual rights and the rule of law but has become more inward-looking and riven by intractable internal divisions. On the other is China, an increasingly aggressive and self-confident one-party state with hegemonic ambitions, unhindered by the rule of law or any sensitivity to human rights. In terms of interests and values, there can never be any doubt whose side we are on.
China’s ambitions and periodic bellicosity are widely manifest. The artificial islands it has built and militarized in the South China Sea threaten neighbouring countries. It has exploited the economic devastation wrought by the pandemic to divert attention from its hostility to Hong Kong and India. Its “Belt and Road Initiative” seeks global dominance through $1 trillion in capital investments — “debt trap diplomacy” designed to extract concessions from nations that default.
Yet it presents itself as benevolent and peace-loving. This month Canadians got an inside look from Victor Gao, vice-president of the Beijing-based Centre for China and Globalization. He joined a Munk Dialogue from Beijing to talk about China’s role in global affairs after COVID-19. Although superficially friendly and interspersed with useful insights and encouragement of a prisoner exchange, his remarks were sometimes infuriating and chilling.
Mr. Gao opened with a jaw-dropper about how China was the first victim of the coronavirus — with no acknowledgement of his government’s concealment of the disease’s virulent nature from the rest of the world. He also omitted reference to how flights continued to foreign cities from the virus’s epicentre, Hubei province, even as its 60 million residents were barred from travelling elsewhere in China. Instead he congratulated his government for “fighting alone” so effectively. And he assured us it would be “vigilant about importing the virus into China” — presumably from countries that had unsuspectingly imported it from China in the first place. At some level, you have to admire the gall!
Despite China’s propaganda and bullying, we can create a modus vivendi with it that serves our interests. China benefits significantly from trade with Canada. In the past five years it sold Canada products totalling $350 billion, enjoying a cumulative trade surplus of over $234 billion. But there are alternatives to Chinese electronics and electrical imports in other Asian countries, including Taiwan, so we have cards to play.
One sector of enormous potential is oil and gas, where our two countries have a strategic complementarity. Canada needs to diversify its overseas markets and China wants to diversify its sources of supply, a point I heard personally from President Xi Jinping in 2015. If we can build pipelines to tidewater, that would generate billions in revenue. Global demand for oil and gas is projected to increase for many decades, especially in Asia, so Canada would be in the driver’s seat on this important file.
We should rapidly address supply-chain vulnerability in critical areas like PPE and pharmaceuticals, either with domestic production or imports from elsewhere. China has cornered the market for rare earths that we have in abundance but so far have not exploited. We also need a careful review of Chinese direct investments, especially those posing national security risks. In particular, we should keep Huawei equipment out of our 5G networks.
The Magnitsky Act can target the immense wealth (estimated at $470 billion) of the members of the Standing Committee of the National People’s Congress who this week imposed the oppressive national security law on Hong Kong. We need to internationalize a robust response to Chinese violations of the rule of law, especially with the U.S., EU, India, Japan and Australia. We should push the U.S. for help with the two Michaels, considering that Canada is bearing the burden of its extradition request. And we should withdraw from the Asian Infrastructure Investment Bank.
Because China will retaliate we need to move in a measured fashion in co-ordination with allies, in a way that makes clear there are consequences to alienating some of the world’s most influential economies.
Above all, we need to assert our interests and values with actions, not empty catchphrases and supine pleading that only encourage more bullying. Standing tall as a proud nation will further our long-term prosperity, security and sovereignty.
Joe Oliver was minister of energy and finance minister in the Harper government.