Canada-China Relations Committee on March 9th, 2020

[Guy Saint-Jacques]

Thank you for your question, Mr. Bergeron.

First of all, with regard to your first question, I think we need to adopt a much stronger language with China. As soon as we discover a case of interference in Canadian affairs, we have to react. However, there is a difference between influence and interference. The role of an embassy is to try to be as influential as possible. When you send ambassadors abroad, you expect them to become friends with political leaders, economic leaders and academics. So they develop a network, and it is the value of that network that determines their own value.

That said, China expects self-censorship. You see it on Canadian university campuses, where some sinologists are not very critical of China, I think. Maybe it's because they don't want to cut off their access there.

The only language China understands is the language of firmness. For example, when I was ambassador, we negotiated an agreement under which Chinese investigators could come to Canada to meet with fugitive economic criminals. A protocol was established so that there would necessarily be a Mandarin-speaking member of the RCMP at all meetings. At the end of one visit, I was informed by CSIS officials that there had been meetings outside of this framework. I asked them to provide me with the necessary information, and I went to see the Deputy Minister of Public Safety.

I asked him how the visit went. He told me that it went very well and thanked us for our collaboration. I asked him how he would feel if, after receiving guests in his home, he discovered that the silverware had disappeared. He asked me what I meant. I told him that his staff thought they were very smart and I showed him what they had done. I told him that if it happened again, a Chinese investigator would never come back to Canada again. He said that no one was going to violate the memoranda of understanding. So I think that's what needs to be done in all areas.

I'd now like to turn to the four laws in Australia. The first is the creation of a register in which all former politicians and senior officials working for a foreign state must be registered. I think that's a good way to ensure more transparency.

The second bill, which was passed, was aimed at preventing interference within the Australian political system, but also within the Chinese-Australian community and on campuses, through rules and punishments.

The third bill created a superministry where intelligence and security matters were consolidated to better address national security issues.

Finally, the last bill was about foreign donations to political organizations. The law now prevents such donations.

[Stéphane Bergeron, Bloc, Montarville, QC]

Mr. Balloch, would you like to add something?

[Howard Balloch]

I completely agree with Mr. Saint-Jacques. I think we need to work with the provinces as well, because they also have important responsibilities to prevent Chinese interference on our campuses and in Chinese-Canadian communities.

I have nothing particular to add on how we do it. I would seek our experts to figure out what we watch for in terms of their interference and how we align proper penalties for breaking those, but I would be very strict. We hear it all the time; people come innocently to Canada, to work in our graduate schools, and then they get a phone call that they are supposed to do something, or not do something, at the request of the Chinese consulate or embassy.

There is a lot we can do. It needs to be looked at. I agree completely with Mr. Saint-Jacques: We need law.

[The Chair, Liberal, Geoff Regan]

Mr. Harris.

[Jack Harris, NDP, St. John's East, NL]

Thank you.

Thank you to both of you for your excellent presentations and for your service to Canada in your former roles.

I hear you when you say that there is no such thing as a China policy writ large, but surely this is what you're telling us to do. We need more policy. We need to be firmer with this. We need to have rules about that. We need to take action on this, that and the other thing. Fair enough, because that's what we're here for, I think. It's to try to figure out what those elements are.

Let me just put it to you that the material we received from Global Affairs Canada noted that of Canada's top 10 exports to China in 2018, eight were either natural resources or agricultural products that are “vulnerable to sudden and arbitrary trade disruptions”, which we've seen, of course, in the past year. Given that, and given your suggestion that we follow the route of Australia, to some extent, in terms of some of the rules—we saw what happened to them in the years following that, as well as to Norway—should we be prepared to accept, in doing this, that with these kinds of disruptions, we can't count on having agricultural trade with China even though it's helpful to our food security, etc.? Would that be what we'd be inviting if we started adopting these rules holus-bolus? I'm not saying that we should or shouldn't; I'm just asking you if that would be the result.

My question is for both of you.

[Howard Balloch]

We have many interests in China, absolutely. On the export file alone, agricultural and raw materials are very important. We also have a lot of services interests in China. China also has significant interests in our country. If they start taking specific measures against our goods, we should absolutely look at taking specific retaliatory measures. As Mr. Saint-Jacques said, the one thing that China respects is firmness. They don't respect weakness. We should of course try to persuade them that this is the wrong way of trying to resolve disputes, and I think giving in when they are using leverage like that is the wrong response.

Yes, we should have measures. Those don't need, I believe, to be incorporated into law. Those are government policies that can be applied. We've just seen the United States say, in response to the kicking out of some Wall Street journalists, that the Chinese media in the United States has to cut its staff by 40%. That's a good message of reciprocity. Reciprocity is a good principle.

[Guy Saint-Jacques]

I agree with Howard.

I would add that in fact that's why we need a strong WTO. The problem with China is that they are expert at using non-tariff barriers, and by this I mean, for instance, phytosanitary reasons. I had to get involved many times to resolve issues related to blackleg in canola exports. That's why we negotiated an agreement back in 2016, which was supposed to be in force until March of last year. It was to ensure a steady flow of Canadian canola exports, but the Chinese, again, are expert at....

I think the message to China should be that we have no problem with them being a superpower and playing a larger role on the international scene, as long as they are a better global citizen and as long as they play by the rules. That's why we need to work with allies to counter those attempts where they are respecting the rules when it suits their purposes—otherwise, they will just penalize you.

We should even welcome them to join the CPTPP, but again, as long as they play by the rules. The message should be loud and clear. In that regard, I think our policy should be different from that of the United States.

[Jack Harris, NDP, St. John's East, NL]

The issue of human rights, of course, has been raised as a big issue in China and elsewhere. I want to raise one issue that has to do with human rights, obviously, because it affects so many Canadians, and that's the issue of fentanyl. It's known to be produced in China and imported widely, and it has caused many thousands of deaths in this country.

As a case study, shall we say, gentlemen, with your experience, what efforts can or should Canada make to do something about that and to stop the importation or the illegal production and obviously infiltration into Canada of this terrible drug that has caused so much damage? Is it a Chinese policy to infiltrate Canada with this drug? Or is this something we need to deal with seriously on a criminal level? Also, why would China not co-operate in such a move?

[The Chair, Liberal, Geoff Regan]

In 53 seconds, please.

[Guy Saint-Jacques]

In fact, there has been a lot of collaboration on this. It started when I was ambassador. The RCMP liaison officer was very active on this. Every time we had the chance, we impressed on the Chinese that they had to regulate the laboratories and stop the export of fentanyl. In fact, that's why we tried to develop collaboration with them in various fields. It was so they could be more forthcoming on this issue.

I think it has started in the right direction. I don't know where it stands now because I don't have the latest knowledge, but we were up to at least being able to sensitize them that this was a huge problem in Canada.

[The Chair, Liberal, Geoff Regan]

Thank you, Mr. Harris.

Now, for the second round of five minutes, we have Ms. Alleslev.

[Leona Alleslev, Conservative, Aurora—Oak Ridges—Richmond Hill, ON]

Thank you, both of you. This is phenomenal and very important around what Canada needs to do going forward.

Mr. Saint-Jacques, you made some very important recommendations in your opening remarks. I wonder if I could clarify or get more information on the one that talked about protocols around reporting. Did I understand you correctly in that you're suggesting we would need protocols for Chinese diplomats for any meetings that they or their proxies have with any level of government officials, Crown corporations or academic institutions? Could you give us some thoughts on that?

[Guy Saint-Jacques]

Well, I didn't go that far. I just said that in every aspect we should base our approach on reciprocity. By reciprocity.... You had Dominic Barton here. He has very limited access, as do the staff of the embassy. Well, then, why should we trot to the Chinese residence to have a good Chinese meal for lunch or dinner? I think we have to be conscious that we are going through the worst crisis in the relationship. We have to be consistent in our signalling.

This being said, of course, you may say that I'm contradicting myself, because we have to find ways to continue. However, speaking with the Chinese takes many forms. I have advocated that in fact we should give a one-pager to Chinese visitors coming into Canada to explain why we are stuck with Mrs. Meng and explain the Canadian position. We should use Chinese media like WeChat and Weibo to explain our policy, because there is a reservoir of goodwill in China on Canada, and many Chinese, in fact, are bit surprised at the harshness of the treatments handed out to Canada.

[Leona Alleslev, Conservative, Aurora—Oak Ridges—Richmond Hill, ON]

We should investigate it further in terms of putting some protocols in place.

[Guy Saint-Jacques]

I would say that we have to be clear on where we want to go and base our approach on reciprocity.

[Leona Alleslev, Conservative, Aurora—Oak Ridges—Richmond Hill, ON]

Perfect.

In the second recommendation, you talked about expelling spies. What you didn't mention were perhaps protocols around enhanced review of the processes for Chinese companies doing business in Canada. We know that the Chinese have the national intelligence law, in which articles 7 and 11 demand that “[a]ny organization or citizen shall support, assist and cooperate with the state intelligence work”, no matter where they are. We also know that 70% of foreign-funded companies have party membership in them.

When we're looking at Chinese companies doing business in Canada, should we be actively enhancing our processes to ensure that we are protecting our intelligence and our free market?

[Guy Saint-Jacques]

Well, on this I would say we are in charge. This is our country. These are our laws, our regulations. We welcome foreign investment, but people have to comply.

On that, this should be consistent for all companies. You are welcome to invest in Canada, but we won't tolerate any attempts to circumvent rules or anything like this.

Howard.

[Howard Balloch]

Something I would encourage you to look at is an actual tightening of the Investment Canada Act. We now have rules that insist that takeovers by state-owned companies act like Canadian public corporations in terms of transparency and activity. I think that can be tightened without any damage to the inflow of foreign investment. If they come here, as soon as they are here they should be transparent. They should be absolutely strictly watched to ensure they abide by Canadian law.

[Guy Saint-Jacques]

If I may add, you were told by a previous witness that the total amount of Chinese investment in Canada is about $16.7 billion. Well, the actual number is $90 billion. The China Institute of the University of Alberta has done a thorough review, which changed the picture: $90 billion is quite different from $16 billion.

[Leona Alleslev, Conservative, Aurora—Oak Ridges—Richmond Hill, ON]

Absolutely, but wouldn't you say that the national intelligence law of China, as stated here, is in conflict with Canadian law already?

[Guy Saint-Jacques]

Well, there could be extraterritorial applications. That's what we should be concerned about. In fact—and I've listened to some of the comments of Ren Zhengfei, the CEO of Huawei—no Chinese company can refuse a request from the Chinese government to provide information. We know that Alibaba, Tencent and JD.com are providing all the information to the Chinese government to put in place the social credit system. It's a concern. We have to look at ways in which this could have an impact in Canada.

[Leona Alleslev, Conservative, Aurora—Oak Ridges—Richmond Hill, ON]

Please go ahead—

[The Chair, Liberal, Geoff Regan]

I'm sorry, the time is up.

Mr. Oliphant.

[Rob Oliphant, Liberal, Don Valley West, ON]

Thank you very much, Chair, and thanks to both of you for being here today.

As recently as yesterday, I was asked what keeps me awake at night in my job as parliamentary secretary, and it is, without a doubt, consular issues. It is, without a doubt, Canadians around the world in various states of turmoil or detention, etc. The issues that keep me probably the most awake are the issues of arbitrary detentions like those of Michael Kovrig and Michael Spavor, as well as the arbitrary resentencing of Mr. Schellenberg.

Maybe I'll start with you, Mr. Saint-Jacques, because I know that you have a personal interest in this and a care that you've expressed. You're both saying in various ways that engagement needs to be realistic, and not romantic, but that it is necessary. We cannot not engage with China.

I've been working on this for many months now, and I have not found a silver bullet in terms of how to engage, at what level to engage, how to demand and how to express how Canada should be operating in this world right now, given our extradition agreement with the United States, given our court proceedings that are continuing and given our absolute concern for the well-being of Canadians arbitrarily held in detention.

I want to push a bit on that for your advice with respect to what in the diplomatic tool kit we may not have been doing and what we can do more of. We have unprecedented numbers of allies we are working with, and other countries haven't done this, but it's not working yet. I've been told by some ambassadors from other countries that we have to settle in and recognize that it will be a while, but I'm anxious and I'm impatient.

I'm wondering if you could help us with that.

[Guy Saint-Jacques]

I would say that consular issues kept me up at night as well. When I was the ambassador, we had two Canadians who were executed on drug charges despite all the pleas that Prime Minister Harper wrote to Xi Jinping the day before one was going to be executed, to no avail, and Governor General Johnston had raised this. Of course, having worked with Michael Kovrig and having recruited him to come to Beijing, I think about him every day.

Again, I would base all of this on our values and, again, we should not compromise. We need to explain and we should explain why those values are important to Canadians, and we need to be consistent in the way we address this. This means that, assuming that we will have a more official contact with the Chinese and at some point relations will resume, we have to explain why we won't tolerate behaviour that we see as bullying or as that of a spoiled child, because in many ways I believe China is now acting like a spoiled child.

Again, we need to explain that, look, Canada has been very helpful to China. As Howard said, we have helped to modernize their legal structure. When I arrived in China for the first time, in Beijing in 1984, they had about 200 lawyers that we helped to train, and the level of justice has been moving in the right direction.