Thank you very much.
Members of the Commons Special Committee on Canada-China Relations, I thank you for the honour of testifying before you today.
I am very grateful for the opportunity to testify before you, and I will be happy to answer your questions in English or French.
This year marks the 50th anniversary of the establishment of bilateral relations between the People's Republic of China and Canada. It also marks the 50th anniversary of my starting to learn Chinese. I see this as a particularly opportune moment from which to examine our bilateral relationship. My presentation is in three parts. In the first part I review the pattern of our relationship. In the second, I offer my perspective on the nature of the Chinese regime and the constraints this imposes on our bilateral relations and our alliance relations. In the third, I offer some perspective on the current state of our relations and how we may move forward.
We negotiated the establishment of bilateral relations beginning in 1968, a time when the People's Republic of China was largely isolated diplomatically during the unprecedented turmoil known as the Cultural Revolution. The premise of our initiative was not to endorse the Chinese regime, nor was it that China would transform itself into Canada. The human rights situation was then much worse than it is today. Underlying our establishment of diplomatic relations—and I defer to Professor Paul Evans on this question, since he literally wrote the book—was to bring China into the community of nations for the sake of global peace and security, as well as to diversify our foreign relations and trade and to show ourselves to be an independent global actor.
Our effort was eventually rewarded beyond our initial hopes. The People's Republic of China took its seat as a permanent member of the UN Security Council within months of the establishment of diplomatic relations in October 1970. Within 10 years, China began the process of reform and opening up, which led to China's spectacular rise. Canada played a role as a partner in China's reform and opening through our CIDA program, which began in 1981. China's reform and opening turned into a hope that China's reform would lead it to being a full participant in the liberal international order.
This initial hope was contradicted by the events of Tiananmen in 1989. When China's economic reforms resumed in 1991-92, our CIDA programs also continued, and hope was reignited, albeit on a more cautious and more long-term trajectory. China's efforts to join the World Trade Organization were symbolic of this renewed effort, and it was in this context in 1998 that then Chinese premier Zhu Rongji called Canada “China's best friend in the world.” Canadian efforts facilitated the adaptations of China's legal system and its institutions to the demands of an open trading system when China entered the WTO in January 2001.
In the 21st century, China no longer needs Canada to tutor it, nor to open doors for it. Just as China's success grew apparent, our relationship lost its overall strategic rationale. The spectacular growth of the Chinese economy became the new justification for our relationship, but we were disappointed that our previous history granted us no special privileges in the Chinese market. Even the team Canada approach failed to arrest the decline in our market share of the Chinese economy, and our trade fell into persistent deficits that see us buying basically two dollars of goods for every dollar we sell. We have not been able to establish a strategic focus in our relations under both Liberal and Conservative governments. Over the past decade and a half, as China's power has grown, our disappointed hopes have become increasingly tinged with fear.
In terms of the nature of the Chinese regime, since Xi Jinping rose to power at the 18th party congress in 2012, China has moved from a defence of China's difference as an exception to the universality of liberal values to celebration of its governance based on its own cultural traditions and achievements of the Communist regime.
Xi has been careful not to broadcast that the Chinese model should be copied or imposed, but nonetheless offers his country's experience as a model for developing countries to learn from. However, it is worth remembering that at the time when Canada recognized China, in October 1970, Chairman Mao and the Chinese Communist Party still espoused global revolution and the overthrow of capitalism. That is not the case today. Beijing's concerns about liberal democracy largely stem from its fears about the domestic security of its own regime. It does not seek to aggressively undermine regimes abroad. It’s not Russia. As the world's greatest exporter, China is inherently committed to an open, rules-based international trading order. China is trying to cement its status through initiatives like the belt and road initiative and the Asian Infrastructure Investment Bank.
These efforts to increase prosperity and connectivity through the BRI and the AIIB are not in themselves a threat to Canada. Investment in public goods, like infrastructure, will pay dividends even if we are not direct beneficiaries or participants. Moreover, closer engagement will allow us to exercise some influence, such as our membership in the AIIB, over the direction and management of these programs. We confront China as a successful competitor that has adapted market methods to achieve state-led goals. This is a challenge, but it is not a threat to the rules-based order in itself.
China's Leninist regime is designed to insulate the political leadership from outside influence, domestic or international, so its entire outlook is based on insulating itself from the outside internally and externally. However, the continued survival of the Chinese Communist Party—the People's Republic of China has now survived longer than the Soviet Union did—requires it to adapt and learn. China is sensitive, in the best and worst sense of the term, to outside opinion and to criticism from below.
The Chinese dream of China's great rejuvenation represents joining the world, not isolating China from it. One concrete expression of this is the hundreds of thousands of Chinese students in Canada. Our strategy must allow for different representations of the will of the Chinese people, while recognizing that the Chinese government we are dealing with is the government that is empowered to make commitments by the Chinese state. We have no control or say on how it may change or when.
Canadian prosperity and global influence depend on having a workable relationship with China. Right now we have the worst relationship with China of any of the G7 countries, but there are signs that our relationship is thawing. This provides hope for improvement, but I share with other Canadians the conviction that there can be no fundamental improvement in the relationship until the two Michaels go free.
The Chinese have an expression they employ often in their diplomacy called qiutong cunyi, which means emphasize points of agreement while reserving differences. We must craft a strategy that allows us to do that even though we have serious, ongoing human rights concerns, particularly as regards Xinjiang. We cannot disentangle China from the fate of the globe, and any hope of isolating or containing China is doomed to fail. There is a whole agenda of issues, including climate change and global health, where we have no choice but to work with China. Our prosperity, like China's, depends on an open, rules-based trading system. We cannot safeguard that system and a healthy environment for global innovation without China.