OTTAWA, Nov 27 (Reuters) – Canada launched its long-awaited Indo-Pacific strategy on Sunday, spending C$2.3 billion ($1.7 billion) to boost military and cyber security in the region and pledged to tackle a “disruptive” China while working with him on climate change and trade.
The plan detailed in a 26-page document said Canada will tighten foreign investment rules to protect intellectual property and prevent Chinese state-owned companies from grabbing supplies of critical minerals.
Canada wants to deepen ties with a fast-growing Indo-Pacific region of 40 countries that account for almost C$50 trillion in economic activity. But the focus is on China, which is mentioned more than 50 times, at a time when bilateral ties are jealous.
Four cabinet ministers at a press conference in Vancouver took turns detailing the new plan, saying the strategy was crucial to Canada’s national security and climate, as well as its economic goals.
“We will engage in diplomacy because we believe that diplomacy is a strength, but we will also be firm and that is why we now have a very transparent plan to engage with China,” Foreign Minister Melanie Joly said.
Prime Minister Justin Trudeau’s Liberal government wants to diversify trade and economic ties that are overwhelmingly dependent on the United States. Official data for September show that bilateral trade with China accounted for less than 7% of the total, compared with 68% for the United States.
Canada’s outreach to Asian allies also comes as Washington has shown signs of growing wary of free trade in recent years.
The paper highlighted Canada’s dilemma in forging ties with China, which offers significant opportunities for Canadian exporters even as Beijing looks to shape the international order into a “more permissive environment for interests and values that are further and further away from our own,” he added.
CHALLENGE CHINA
However, the document said cooperation with the world’s second-largest economy was needed to address some of the world’s “existential pressures,” including climate change, global health and nuclear proliferation.
“China is an increasingly disruptive global power,” the strategy said. “Our approach … is shaped by a realistic and clear assessment of China today. In areas of deep disagreement, we will challenge China.”
Tensions with China flared in late 2018 after Canadian police detained a Huawei Technologies executive and Beijing subsequently arrested two Canadians on espionage charges. All three were released last year, but relations remain sour.
Earlier this month, Canada ordered three Chinese companies to divest their investments in critical Canadian minerals, citing national security.
The document, in a section that mentioned China, said Ottawa would review and update legislation that allows it to act “decisively when investments by state-owned enterprises and other foreign entities threaten our national security, including our supply chains supply of critical minerals”.
“As the region is large and diverse, one size definitely does not fit all,” Canadian Chamber of Commerce President Perrin Beatty said in a statement, adding that Canada’s priorities will need to be very nuanced both between countries and within countries.
The document said Canada would increase its naval presence in the region and “increase our military engagement and intelligence capability as a means of mitigating coercive behavior and threats to regional security.”
That would include the annual deployment of three frigates to the region, up from two currently, as well as the participation of Canadian airmen and soldiers in regional military exercises, Defense Minister Anita Anand said at a separate news conference.
Canada is part of the Group of Seven major industrialized nations, which wants major measures in response to North Korea’s missile launches.
The document said Ottawa was committed to the region with partners such as the United States and the European Union.
Canada needed to continue talking to nations with which it had fundamental disagreements, he said, but did not name them.
($1 = 1.3377 Canadian dollars)
Reporting by David Ljunggren; Editing by Denny Thomas, Leslie Adler, Daniel Wallis and Mark Porter
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David Ljunggren
Thomson Reuters
It covers Canadian political, economic and general news, as well as breaking news in North America, previously based in London and Moscow and winner of the Reuters Treasury of the Year award.