Canada-China Brief: Canada's Indo-Pacific strategy, political interference allegations & more

This week's edition covers?Canada's release of its Indo-Pacific Strategy, the summoning of Beijing's ambassador over?illegal Chinese 'police stations',?and more.??

First, here's the latest from IPD:

IPD's?Roundup

Dialogue on the Future of Canada-China Environmental Diplomacy

IPD?is pleased to announce a new partnership with the?Canada China Forum ?and the?Climate Action Network ?to co-host an event on the sidelines of the 15th Conference of Parties to the United Nations Framework Convention on Biological Diversity (COP15) to be held in Montreal. It?will convene stakeholders to reflect on how?China and Canada can further collaborate on global environmental threats like the climate and biodiversity crises.

Canada & China in an Age of Great Power Rivalry: Addressing Challenges, Resetting the Relationship

Read IPD's newly-published collected works from its China Strategy Project edited by Research Fellow Zachary Paikin, featuring a foreword from Senator Yuen Pau Woo, and contributions from Jeremy Paltiel, Yanling Wang, Xiaobei Chen, Wenran Jiang, and Paul Evans.

The Hill Times: Alleged Chinese Interference an ‘Awkward’ Situation for Trudeau’s Liberals

Interviewed by The Hill Times on allegations of Chinese interference in Canada's general elections, Senior Fellow Jeremy Paltiel notes?that the Chinese Canadian diaspora is pluralistic and that "Canadian political parties are trying to make inroads in the immigrant community" but have "become caught up in this vortex of who speaks for Chinese?"

Responsible Statecraft: What Accounts for This Sharp Canadian Shift Against China?

Senior Fellow Andrew Latham writes for Responsible Statecraft that as Canada releases its Indo-Pacific Strategy, it "heavily favors opposition to China, even if that is bound to be tempered for some time yet by economic considerations and threats of retaliation on Beijing’s part."

Expert Analysis

On Canada's strategic approach?to?China in the Indo-Pacific Strategy:

The language to describe China’s disruptive behaviors is notably and unsurprisingly stark. This was to be anticipated, not only because of the long shadow cast by China’s engagement in hostage diplomacy with respect to the two Michaels, but also due to the increasingly frequent reports of cyber attacks, surveillance of Chinese citizens in Canada, the allegations regarding police activity in Canadian cities, and the accusations of interference in the latest federal elections.?Canadians are concerned about China’s human rights abuses within its borders, including in Xinjiang, Tibet, and Hong Kong, and by the recent reiterations of the intent to bring Taiwan under mainland control.

What is?important for Canada’s long-term navigation of our relationship with China is this: What's next??Will we be able to engage China in dialogue on climate change or the Arctic, or other issues of concern to the international community, and for which there are no solutions without China??Our bilateral dialogues have been on ice for several years since the hostage crisis. Will any of them be revived and if so, when and how? Of course, there are?ongoing conversations between officials on areas of mutual concern, but at what point will senior officials and leaders be ready or able to resume constructive dialogue and conversations??Minister Joly has declared that she does not believe in an empty-chair approach to international relations.?What about the Chinese side?

One thing is certain:?China is not going away.?And Canada is not moving out of the North American neighborhood, where our interests, values, security, and economy are so closely intertwined with those of our neighbor to the south.?Canada must maintain a focussed approach to China that advances and protects Canada’s long-term diplomatic, security, economic, and people-to-people interests while furthering our aspirations and goals in the region.?This will necessarily involve a dispassionate but engaged approach to China that includes regular and ongoing strategic conversations.

—?Susan Gregson , Advisor, Institute for Peace & Diplomacy; Former Assistant Deputy Minister, Asia-Pacific, Global Affairs Canada

Canada's Indo-Pacific Strategy (CIPS) communicated the position that China is part of the Indo-Pacific region, not the other way around. By way of numerous examples, it explicitly highlighted the challenges associated with authoritarian China's rise and its long-term efforts to erode away the rules-based system that has been the cornerstone of Canada's peace, prosperity and stability in the post-WWII?era. These included China’s disregard for UN rulings on disputes in the South China Sea, and its actions to further militarize that region and challenge navigation and overflight rights, coercive diplomacy and non-market trade practices, arbitrary detention, and its efforts to block the UN High Commissioner for Human Rights’ report on the situation of Uyghurs in Xinjiang. Simultaneously, CIPS has also not ruled out?cooperation with China on global issues such as climate change, biodiversity loss, global health and nuclear proliferation.?

—?Stephen R. Nagy , Senior Associate Professor, International Christian University, Tokyo

This Indo-Pacific Strategy?appears to be written for two?different audiences with two very distinct objectives rendering it less coherent than the authors intended. Containment of China is the priority with competition a distant second.?In what amounts to a clear denial of some basic realities,?the authors cannot?bring themselves to inform Canadians that China is Canada’s second-largest trading partner. At the same time, the report advances a policy premised on competitive multilateralism. For every trade organization that China is part of, Canada will work to develop a counter-organization. How much Canada spends in achieving its objectives is largely irrelevant since it is clear the Liberals expect to capitalize on the trillions of dollars the U.S. is committed to spending in its war against China.

—?David Carment , Senior Fellow, Institute for Peace & Diplomacy

Top Stories

Joly unveils Canada's long-awaited Indo-Pacific Strategy

In a Vancouver press conference alongside trade minister Mary Ng, international development minister Harjit Sajjan, public safety minister Marco Mendicino, and fisheries minister Joyce Murray, foreign affairs minister?Mélanie Joly announced Canada's "generational" strategy for the Indo-Pacific.

Five pillars —?The lengthy plan?outlines ?'interconnected strategic objectives' that frame engagement over the next decade:

• These include?peace and security, trade and supply chain resiliency, people-to-people ties,?green and sustainable development, and a more proactive diplomatic profile and footprint in the region.
• In a?backgrounder ?on the strategy's financial commitments, Ottawa promised $2.3 billion in largely new financing to fund the plan's initiatives until 2027, when a review will "return with an update that will cover initiatives and resources for years 2027-2032."
• The most significant line items in the strategy's budget include $492.9 million for the Canadian Armed Forces' presence in the region as well as?$750 million for FinDev Canada to support "high-quality" infrastructure in line with the G7 Partnership for Global Infrastructure and Investment.
• On economic engagement, the strategy placed an emphasis on opening Southeast Asian markets, diversifying supply chains,?achieving an Early Progress Trade Agreement with India as a "critical partner," and reinvigorating?"Team Canada" trade missions deployed to the region.
• Diplomatically, the plan committed to appoint a special envoy to the Indo-Pacific, establish a new post to liaise with the U.S. in Hawaii, implement the Strategic Partnership with ASEAN, and add China analysts to missions at the UN, EU, and NATO.

A sharper China policy?—?Reportedly?unmentioned in past drafts, the final document settles on labelling Bejing a "disruptive global power":

• Critiquing China for seeking "a more permissive environment for interests and values that increasingly depart from ours," the strategy highlighted the South China Sea, coercion, and more,?vowing?to "work closely with its partners to face the complex realities of China’s global impact."
• The plan noted Canada "must remain in dialogue with those with whom we do not see eye-to-eye," spelling out climate change and nuclear proliferation as collective concerns while recognizing that "China’s economy offers significant opportunities for Canadian exporters."
• Interviewed by La Presse, Joly?said ?that "most of the Indo-Pacific strategies of our allies do not include China," saying she "decided to make it into a strategy, because you can't talk about the Indo-Pacific without talking about China."
• She added that she has spoken of?Canada's "re-engagement framework" with Beijing in her meetings with Chinese?counterpart Wang Yi, stating "he doesn't necessarily agree, but I told him that at least it's transparent."

Ministers defend plans —?Cabinet members have taken to the media circuit to elaborate on the announced initiatives, tone, and timelines:

• Joly?underlined ?one orientation of the strategy to CBC, saying "we're introducing this new concept which is the Northern Pacific" that is about?"creating a stronger relationship with Japan and Korea" in a manner that she compared to NATO and?"investing in more military assets."
• Minister Anand echoed these shifts in a press conference,?noting ?funds for a new frigate to augment annual naval deployments to the region, capacity-building in Southeast Asia, as well as intelligence capabilities to "enable close collaboration with our?Five Eyes and regional partners."?
• Speaking to CTV on China, Joly?stated ?that "we are calling a spade a spade" and reiterated that "we will compete with China when we ought and we will cooperate with them when we must" and that "the idea is to make sure the frame is clear."

Economic stakeholders react —?The business community was largely optimistic about the strategy's promises and understandings?but sought specifics:

• Carlo Dade, Director of the Trade & Investment Centre?at the Canada West Foundation,?cautioned ?that "for this strategy to be taken seriously, there has to be indication that they will outlast changes in government" and that Ottawa's reputation is that is "we show up and disappear."
• Goldy Hyder, President of the?Business Council of Canada, said that?in China, "business is in the business of managing risks" and that "we are glad that nobody said, ‘Don’t do businesses in an x, y or z country.’ I think that would have been counterproductive and harmful."
• Separately, Hyder?called ?for "an express commitment by the government to provide secure supplies of Canadian LNG to our allies in the region along with specific details of how it will expedite the approval of Pacific-coast energy export infrastructure" given energy security concerns.
• Meredith Lilly, a former trade adviser to Stephen Harper,?observed ?that there was "no mention of friendshoring" and that “if anything, the strategy offers a rebuke, proposing greater diversification and doubling down on adherence to rules as resilient responses to protectionism."

What commentators think —?Scholars both welcomed the announcement and noted the room to be more regionally sensitive as the U.S. and China differed:

• Roland Paris, a former senior advisor to Justin Trudeau,?termed ?it "the most substantive strategic document on foreign policy that we've seen from any Canadian government for a long time" but asked for government?"reporting on whether it's meeting specific targets."
• Shaun Narine, a professor at St. Thomas University, suggested it appears to be "going in with our presumptions about what the regional state should be, about what it is that we expect of them" and that "we're not listening to what they want. We're not actually considering what their interests are."
• Stéphanie Martel, a Distinguished Fellow at the Asia Pacific Foundation,?noted ?Ottawa's language on?its Strategic Partnership with ASEAN was at times inconsistent with what ASEAN was referencing, saying "we should also invest in improving our understanding of how ASEAN works."
• U.S. Ambassador to Canada David Cohen was quick to issue a statement,?calling ?Ottawa "one of the United States’s most important friends and allies, to advance our countries’ shared priorities in the Indo-Pacific region."
• Chinese Foreign Ministry Spokesperson Zhao Lijian?said ?the strategy was "dominated by ideological bias," noting past Canadian remarks on how it "would like to improve and grow relations" but that it "needs to honor its words, show sincerity and goodwill, [and] seek common ground while reserving differences."

Chinese ambassador summoned over Chinese 'police stations' in Canada

Last week, the Canadian government?summoned ?the Chinese?Ambassador to Canada Cong Peiwu to explain?reports of illegal Chinese 'police stations ' operating in Canada. Warnings of further action have been made to Beijing and investigations led by the RCMP are currently underway amid further accusations of election interference.

Objections raised?—?Weldon Epp, Director General of North East Asia for Global Affairs Canada,?testified ?to MPs in the Canada-China special committee:

• "We’ve had several engagements. We’ve called the ambassador in on multiple occasions, and we have conveyed our deep concern."?
• "The Government of Canada has formally insisted that the Chinese government take account for...?any activities within Canada that fall outside of the Vienna Conventions, and account for those and ensure that they cease and desist.”
• “We continue to hold open the possibility of following up on those meetings with further decisions for how we take that forward, depending on how they respond.”

Denials and dismissals?—?The Chinese Embassy in Canada denied that Beijing operates police stations in Canada:

• Acknowledging?three addresses flagged in a report?published ?by Safeguard Defenders, a Madrid-based NGO, the Embassy responded that they were service stations in Canada that helped Chinese citizens process paperwork and obtain Chinese driver's licenses.?
• The controversy comes amidst?statements ?from Prime Minister Trudeau that he did?"not have any information, nor have I been briefed on any federal candidates receiving any money from China" in response to separate allegations of electoral interference.
• A statement from the Chinese Embassy?denied ?allegations of Chinese political interference, labelling them "purely political manipulation," adding that Beijing "always adhered to the principle of non-interference in the internal affairs of other countries."
• Chinese Foreign Ministry Spokesperson Zhao Lijian also?denied ?accusations that?Beijing intervened in Canada's?federal elections, calling them "completely groundless" and urging Ottawa to "stop misleading the public."
• Canada's?Chief Electoral Officer Stéphane Perrault?stated ?that "there's no reason to believe that it was not a free and fair election" in 2019 and that he had "not received any reports regarding... specific instances of Chinese interference in the election."

What commentators think?— Canadian lawmakers and experts expressed concerns over the allegations.

• Conservative foreign affairs critic Michael Chong?called ?the reported stations?"an outrageous and brazen intrusion on Canadian sovereignty," stating that "the establishment of these illegal police stations is a symptom of a much deeper problem."?
• David Mulroney, a former Canadian ambassador to China,?commented ?that "Beijing always goes for the weakest link in the chain," adding?that Canada was increasingly viewed by China as a way to target the United States and that “we cannot afford to be in that position. We just can’t.”
• Dennis Molinaro, a former senior CSIS analyst,?said ?the level of foreign interference activity alleged?is "serious and alarming" and "says to me that foreign adversaries understand the legislative loopholes that exist in Canada and are taking full advantage of them.”

What They're Saying

In recent years, the United States has concocted the Indo-Pacific Strategy under the banner of “freedom and openness”, but in essence, it attempts to make Asia-Pacific countries “pawns” of U.S. hegemony, trying to provoke tensions and mess up the Asia-Pacific region after having messed up other regions.?Unfortunately, it seems that Canada has followed the U.S. practice of creating division and fomenting confrontation in the region. It launched the Canadian version of the "Indo-Pacific Strategy" yesterday. Of course, it is up to each government to decide what kind of policies they will have, but what concerns us is that when comes to China, it distorted facts, hyped up the so-called "China threat" and infringed upon China’s internal affairs. We firmly oppose it. Facts have proved time and again that China’s development is an opportunity, not a threat.

—?Cong Peiwu , Ambassador of the PRC to Canada

Canada’s new?Indo-Pacific Strategy?offers an opportunity for the federal government to take the urgent action required to respond to the threats China poses to our economic security, particularly our innovative technology sector. But while it is a good start, it’s not enough.?Canada’s strategy needs to go much further. Failure to act now could not only have dire consequences for our national security but also erode our long-term economic competitiveness.

—?Shawn Barber , former Director General & Head, Task Force on Economic Security, Public Safety Canada

[Mélanie] Joly has taken into account a fundamental fact of the Asian states' situation: their attachment to a superpower, China, whose regional ambitions must be framed rather than halted. In Ottawa, we know what it means to be a neighbor to a giant. Our historical experience with the United States has taught us how to compose a diplomacy of nuances and to develop with the states, the cities, the lobbies, the professional associations, the links that are so important to exercise a counter-power to the American federal government... [Joly's speech on the Indo-Pacific]?broadens the range of relations with Asia to better extricate itself from Beijing's embrace.

—?Jocelyn Coulon , former Senior Policy Advisor to the Foreign Minister; Advisor, Institute for Peace & Diplomacy

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