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Consul General Mme. LU Xu's Keynote Speach at the "Indo-Asia - Canadian export opportunities in agri-foods and energy" Video conference
2021-12-14 09:22

Mutual Respect and Harmony in Diversity Cultivate Business Opportunities

(December 9, 2021)


Good afternoon, everyone.

It’s my pleasure to be invited again to the second episode of the virtual discussions.

This time, we will focus on the export opportunities of Canadian agri-products and energy. As you already know, China has a vast market to absorb high-end agri-products as well as energy which Canada is abundant for. Taking energy as an example, China consumed 702 million tonnes of oil in 2020, of which 542 million tonnes were imported, representing a 77.21% dependency rate. During the same year, China consumed 325 billion cubic metres of natural gas, of which 141.4 billion cubic metres were from abroad, representing a 43.49% dependency rate. This trend is set to rise over the next 20 years. The thriving Chinese market will undoubtedly provide unlimited opportunities for Canadian products.

Being a business person, it is natural to think from a business perspective. However, if we take a look at the important lessons from the 50-year bilateral relations between China and Canada, especially in the past 3 years, it is easy to jump into a conclusion that business and trade exchanges are never running independently of sound political relations and favorable public opinion.

Some said the returns of 3Ms was helpful to get the strain between China and Canada relieved. I’m sure both Chinese and Canadian business communities would like to see a speedy restore of bilateral relations and an early resumption of close business cooperation. Unfortunately, we haven’t yet seen a remarkable sign of a strong recovery. Although China-Canada bilateral trade had a good performance so far this year, it is far from the better and satisfaction. It still lacks positive factors for a major step forward.

So, what’s wrong? What are the positive factors that allow Canadian products successfully landing on the Chinese market?

During the last episode, I mentioned some of the “economic factors” that can facilitate bilateral trade. This time, I’ll touch upon the “non-economic factors” relating to the decisive and dominant role played by the bilateral political relation and public opinion. In my view, it is impossible to turn the “business opportunities” from the drawing board into reality without addressing the negative aspects of these “ non-economic factors”.

What are the negative aspects of the “ non-economic factors” for us to nail down? 

Let’s start by looking at history for answers.

In 1968, Prime Minister Pierre Trudeau decided to establish diplomatic relations with China. His idea was finally realized in October 1970. This milestone was 2 years ahead of President Nixon’s visit to China. According to Professor FU Yaole, from 1968 to 1970, Canada had tried 4 times to reach out to China, attempting to establish diplomatic relations or set up trade offices in China, but got cold feet at the last minute. It was because either China was under the banner of communism or the U.S., the big boss, was interfering.

This story tells us that although China has always been an economic opportunity in the distance, the ideological bias proves to be the biggest hurdle and requires great political wisdom and courage to cross. Furthermore, the big boss may not always be right, especially when the U.S. later established diplomatic ties with China by following Canada’s footsteps. 

In 1989, a collective sanction made by the West against China failed to last long and didn’t stop China from continuous growing. Relations were restored by the West with China soon after. In 2001, Prime Minister Jean Chrétien visited China with a delegation of over 600 people. It was the largest foreign mission at that time in Canadian history. The trip led to the signing of nearly 200 contracts and agreements between Chinese and Canadian representatives.

This story tells us that the approach of weaponizing values of human rights and democracy was neither sustainable nor up to expectation, conversely, quitting it resulted in win-win scenario. Furthermore, China didn’t and will never bend itself to external pressure for economic benefits. 

Let’s rewind the clock for 3 years. In 2017, Prime Minister Justin Trudeau prepared a free trade talk in his trip to China. This, if signed, would have certainly boosted bilateral economies and trade. For some reason, the FTA didn’t survived the trip but still got chances. However, the following incidents occurred chilled the bilateral relationship and no one dared to mention the FTA since then. To be worse, in the past 3 years, demonizing China became politically correct. Thanks to the repeated labeling China of exercising “ coercive diplomacy” and “ arbitrary detention”, and the non-stop pointing fingers at China on issues related to Xinjiang, HK, Taiwan, and the South China Sea, both Chinese and Canadians lost their favor to each other. Especially Canadians were so awfully misled that only 14% held a positive view towards China. I don’t think the 14% was the full picture of Canadian public opinion and I’m sure not every one of you in this room would agree with whatever some politicians and the media claimed. The sad thing was that your voices were pretty weak and seldom heard publicly.

This story tells us that the long-term misinformation and misleading of public opinion inevitably backfired and did hold back the better economic and trade opportunities.

Having identified the negative aspects of the “ non-economic factors”, we should be able to prescribe the following “remedies” in order to create positive environment for the smooth export of Canadian goods to the Chinese market.

First, be realistic instead of playing ostrich.

No matter whether you like it or not, China is now the world’s second-largest economy and is on track to be the largest. With a population of over 1.4 billion and the world’s largest middle-income group, China houses a huge market with considerable business potentials. This is the reality.

After a hundred years of hard work, China has found a right path that suits its way of development and realization of national rejuvenation. China has made significant historical achievements, including eliminating the century-old problem of absolute poverty. The secret code of China’s success is upholding the leadership of the Communist Party of China and its existing political system, of which China will never abandon. The western world has always had to deal with the Communist China in the past, present and future. This is the reality.

China’s success through its own efforts has debunked not only the passe narrative of “ a rising power will seek hegemony”, but also the current assertion of “ China-threat theory”. A country can absolutely achieve prosperity without sacrificing the interests of others. Instead, it is entirely possible for this country to turn its “ strength” into a positive factor that benefits the whole world. I have to point out that this is the most fundamental distinction between China and the U.S. This is the reality.

At a time when COVID-19 keeps evolving and global economic recovery remains sluggish, global issues like the absence of growth momentum, lagging in proper governance, and imbalanced development require joint efforts of all, including China and Canada, to find the right solution. President XI Jinping’s idea of a “ Community of Shared Future for Mankind” is a “ cure” for many of the problems. In Chinese values, promise is not just for making but for delivering. We have no reason not to achieve win-win results through cooperation. China believes a peaceful and harmonious bilateral relationship between two countries will make both winners, while a confrontational one will make both losers. This is the reality.

I found that many people working in key sectors of the governments and industries in Canada are short of both the knowledge about China and the willingness to learn about China. Is it because they see no need to learn due to its geographic distance, or resist to learn due to its communist system? I have no idea. But I am pretty sure that burying their heads in the sand and pretending nothing has happened and will happen will definitely lead to the lost of the business opportunities in that huge cross-ocean market. 

Second, be inclusive instead of whistling into the wind.

In the midst of the cold war, the Chinese and Canadian leaders overcame impossible odds and made the historic steps to establish diplomatic ties. This visionary move brought about a long-term friendship and tangible welfare for both peoples. History once again proved that countries with different social systems are able to co-exist and interact peacefully and harmoniously as long as they adhere to mutual respect and equality. We have done so many times over the past 50 years, and I believe we can do the same today, and we should do it even better.

There is an old Chinese saying that is full of wisdom. “ Good relations are conducive to business success ”. China never imposes the political system and values by its own standard on others as a precondition for economic cooperation. China grows by practicing self-improvement instead of bullying. Regarding democracy, human rights, and other issues between China and the West, China believes there is no single criterion and no outlier is qualified to have the final say. China carries out the “ whole process of people’s democracy” and only the Chinese people are qualified to say whether China is a democratic country or not. As for the differences, China believes in-depth exchanges are better than judging, arguing, attacking, and suppressing. Just like meat lovers and vegetarians hold different values, it doesn’t mean they need to label each other as “evil” or even provoke gang fights. When the US grouped countries into “democratic” and “authoritarian” categories in order to tackle China, it will only lead to the worldwide division and confrontation rather than China’s submission.

Third, be independent instead of subjecting to might.

A good government should be resolutely safeguarding the interests of its own people and never allowing anyone else to sit in the driver’s seat. The independence in foreign policy was once exemplified by Canada’s decision to establish diplomatic relations with China against all interference. That decision is still inspiring to this day.

According to the data released by the Australia-China Relations Institute of the University of Sydney, in the first 9 months of 2021, compared with 2019, the value of Australian exports to China fell by $AUD 17.3 billion. At the same time, the U.S., as “Canberra’s partner”, was quick to take over most of the Australian business in China, with the value of U.S. exports of the same commodities to China increased by $US4.6 billion, making the U.S. the biggest beneficiary of Australia’s trade dispute with China. This was a fresh lesson of “ be careful who you follow”. If you follow your big boss blindly, you are destined to suffer. In recent years, the U.S. disrupted the supply chain in its awareness that COVID-19 is doomed to worsen the situation. Now it seems that the Americans failed to take advantage of the mess, and its allies suffered even more.

In the future, China will be committed to higher levels of opening-up. Whether Canada can seize business opportunities and expand its export to China depends on its own critical analysis, good judgement, and independent decision-making.

Fourth, be mentor like instead of flowing with the so called public opinion.

I believe some politicians and the media can not represent the whole public opinion. However, it is ridiculous to see the Canadian public opinion has long been kidnapped by a few anti-China China experts. There are many Canadians like you who not only desire but also take action to contribute to China-Canadian economic and trade cooperation. Your views should have been part of Canada’s mainstream public opinion. You were blessed with more knowledge about China than others through your long-term engagement in economic and trade interactions with China. You are well-positioned to promote bilateral relations and to inspire and educate more Canadians or even Canadian politicians about China. Please get your voices heard through multiple channels. Be creative about the way you convey your messages. There are so many things you can do to help beef up trust on which mutual understanding is essential. Only when the stage of mutual understanding and trust is all set, will business opportunities flood in uninvited.

That’s all for my presentation. Thank you very much for listening.


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