Canada-China Relations Committee on April 19th, 2021

[The Chair, Liberal, Geoff Regan]

I call this meeting to order.

Welcome to meeting number 23 of the Special Committee on Canada-China Relations.

Pursuant to the order of reference of Wednesday, September 23, 2020, the committee is meeting on its study of Canada-China relations.

Today's meeting is in hybrid format, pursuant to the motion adopted in the House on January 25, 2021.

For our first panel today, I'd like to welcome Carolyn Bartholomew, chairman of the United States-China Economic and Security Review Commission.

Thank you very much for accepting our invitation to be here tonight.

Please proceed with your opening remarks. You have five minutes.

[Carolyn Bartholomew, Chairman, United States-China Economic and Security Review Commission]

Thank you for the opportunity to speak today.

For those of you who don't know, the U.S.-China commission was established by Congress when it voted essentially to pave the way for China to join the WTO, out of lingering concerns about what that would mean. We do a report, 575 pages with recommendations to Congress, which I'm happy to send copies of. I think it's important to acknowledge that we are bipartisan, sometimes one of the only bipartisan institutions functioning here in Washington, D.C.

Our countries, of course, share not only a border, but also values: belief in democracy, human rights and the rule of law; respect for freedom of speech, religion, association; and a free press. We stand with you in opposition to the unjust imprisonment of the two Michaels and urge their immediate release.

Our shared values are increasingly in conflict with and under assault by the Chinese Communist Party. Last Wednesday, FBI director Chris Wray, testifying before the Senate intelligence committee, said:

I don't think there is any country that presents a more severe threat to our innovation, our economic security and our democratic ideas. And the tools in their toolbox to influence our businesses, our academic institutions, our governments at all levels are deep and wide and persistent.

He noted that the agency is opening an investigation into various Chinese government actions here in the United States every 10 hours and currently has over 2,000 investigations that tie back to the Chinese government.

A major tool for CCP influence is the United Front Work Department, which seeks to co-opt and neutralize sources of potential opposition to the policies and authority of the Chinese Communist Party. The United Front's efforts take place both within and outside China.

The United Front has played an increasing role in China’s foreign policy since Xi Jinping’s leadership began. In 2019 alone, China’s national and regional United Front systems spent more than $2.6 billion U.S., more than the budget of China's Ministry of Foreign Affairs.

The mission of the United Front's work includes the goal of “guiding” overseas Chinese to ensure they support the CCP. There is also a strong focus on co-opting and influencing non-ethnic Chinese foreign elites. United Front activities are tricky to discuss in light of increasing xenophobia and violence against Asian Americans. We must be careful always to draw a distinction between the CCP and the Chinese people.

One major target of the United Front is Chinese-language media in non-Chinese countries, which they seek to co-opt or outright control, ensuring the CCP controls the flow of information available to Chinese speakers. For example, the China News Service, an official Chinese government Chinese-language news platform, which also covertly runs other overseas media agencies, is officially part of the Overseas Chinese Affairs Office, which is controlled by the United Front.

To address concerns about CCP influence in media, the U.S.-China commission has recommended, among other things, that the U.S. Congress strengthen the Foreign Agents Registration Act to require the registration of all staff of Chinese state-run media entities, given that Chinese intelligence-gathering and information warfare efforts are known to involve staff of Chinese state-run media organizations. We've also recommended that Congress modify communications regulations to require greater transparency regarding Chinese government ownership of media outlets and the clear labelling of media content sponsored by the Chinese government.

The United Front-affiliated organizations include Chinese students and scholars associations, Confucius Institutes and professional organizations, which offer benefits and support for Chinese students on university and college campuses. This support includes social networking, assistance finding housing and professional advancement. In return, students are expected to rebut any criticism of the CCP and to encourage support for CCP’s global rise. Other sources of leverage exist for pressuring students and others who are uncooperative, including Uighurs, such as threatening family members back in China.

The U.S. Department of Justice late last year charged multiple individuals for their alleged attempts to threaten, coerce or harass certain residents of the United States to repatriate to China. Eight individuals were charged with conspiring to act in the U.S. as illegal agents of the PRC, with six also facing charges for conspiring to commit interstate and international stalking.

Attacks on freedom of speech on campuses are rising, such as attacks on students who support the Hong Kong pro-democracy movement, and challenges inside classrooms to teachings that question the CCP's narrative. At the same time, there is pressure to self-censor, which of course is a less visible response to the United Front's tactics. This trend is a direct threat to academic freedom.

The United Front leverages transnational professional organizations, such as the China Association for Science and Technology and returned scholars associations, to pull in Chinese students and scholars as a labour pool for national priorities and technology development. Some of these organizations appear to be independent but are actually subordinate to the official United Front Work Department. These efforts incentivize the transfer of research to entities within China. The sheer scale at which these transfers occur makes the effort strategically significant and potentially harmful.

The United Front's strategy also seeks to gain support of foreign corporations and business interests by weaponizing China's economy, leveraging the promise of continued or expanded access to Chinese markets to persuade these corporations to pressure their governments to adopt policies friendly to the CCP's interest. This strategy also includes extensive use of traditional lobbying.

Policy responses should include a focus on increased transparency, which would also create increased awareness of funding sources and affiliations with foreign principals.

The U.S. and Canada are not alone in facing increasing Chinese influence operations. Countries around the world are experiencing the push and pull of the CCP's desire for power, influence and primacy. Australia, of course, has been a testing ground for much United Front Work activity, as has Estonia.

In February, Estonia's foreign intelligence service issued an annual report that highlighted Beijing's strong ability to conduct influence operations in the west through economic leverage, surveillance of Chinese nationals abroad and the cultivating of local elites.

We share the challenge of facing the CCP's influence operations and must all work together on effective responses.

[The Chair, Liberal, Geoff Regan]

Thank you very much, Ms. Bartholomew.

We'll now start our first round of questions with Mr. Chong for six minutes.

[Michael Chong, Conservative, Wellington—Halton Hills, ON]

Thank you, Mr. Chair.

Thank you, Chairman Bartholomew, for taking the time to appear in front of us today. I read your report—not the entire 500-page report, but the executive report. Thank you very much for producing a shorter executive summary for people like me.

What is your view of the belt and road initiative? More specifically, what is your view of the China-led Asian Infrastructure Investment Bank?

[Carolyn Bartholomew]

Okay, here's the point at which I'm going to say that some of the views I'm expressing are my own, and the positions are not necessarily the positions of the commission itself.

The Chinese government, the CCP, is really using the belt and road initiative both to create markets for its own products and to increase its influence. They talk about how what they desire, of course, is a community of common human destiny.

Last year, the commission did one hearing on China in Africa, and you could see the impact of Chinese investment in Africa in a lot of different ways. This year, we're going to be doing one next month on China in Latin America.

A tool that they use within BRI is of course the lending that they do. By the way, Montenegro, which got, I think, $1 billion for highway building from China, has just actually told the EU that they need help repaying it. One concern about all the lending they're doing is debt-trap diplomacy, of course. They're using vaccines now, vaccine diplomacy, to try to increase their influence.

The AIIB, I think, was a real effort to try to create a new international institution that would be Chinese-designed and basically Chinese-controlled. They're struggling within the multilateral institutions. They're working hard to influence what's happening in the multilateral institutions, but it was their way to basically start one from scratch.

We should all acknowledge that there are huge infrastructure investment needs in countries around the world. That, I think, is one challenge that all of our countries working together need to address, but some of it is insidious.

[Michael Chong, Conservative, Wellington—Halton Hills, ON]

Thank you.

[Carolyn Bartholomew]

Am I done with my time?

[Michael Chong, Conservative, Wellington—Halton Hills, ON]

No, not at all.

Chairman, you recently talked about a system that Beijing uses, called the integrated joint operations platform, which has the ability to audit entire populations.

I have two quick questions on this. First, can you tell us what role Huawei plays in helping to develop this surveillance technology? Second, can you tell us what your view of Huawei is, with respect to national security?

[Carolyn Bartholomew]

That's an interesting question. It touches right on the heart of what I think is China's promotion of what we call techno-authoritarianism. If you look at smart cities, I understand the desire for local governments to increase their efficiency, but they're allowing the Chinese government access, directly or indirectly, to things like controlling traffic and water supplies, which could all be used against them.

I think it was just yesterday that a report came out that the Dutch have found that Huawei was in their telecommunications network in a way that allowed them to even eavesdrop on the Prime Minister and the Prime Minister's [Technical difficulty—Editor].

I have been quite suspicious of Huawei all along. I think this concept that they are free and independent of the Chinese government is ridiculous. You look even at companies that are supposed to be free and independent of the Chinese government, like Alibaba, and you see what's happening there.

I have concerns. On the commission, I think we all have concerns about how Chinese telecommunications can be used to access data, access information, collect intelligence and shut things down if they want to do that.

[Michael Chong, Conservative, Wellington—Halton Hills, ON]

Thank you.

I read in your report that you noted and highlighted the negative influence that China has had on the World Health Organization. Do you think the WHO is in need of reform to curtail China's negative influence on the organization?

[Carolyn Bartholomew]

That's an interesting question. There are concerns about balance, really. I thought you were going to ask that about the WTO, not the WHO.

This is speaking personally. I think there has been some naïveté or political pressure on the people at the top of the World Health Organization as they were going through and trying to do this analysis and investigation of where the coronavirus pandemic started. I think we're all going to have to look at how to make sure that the people who work for these institutions are protected from any political pressure that might skew what they're saying.

I will also point out—and this is a much bigger topic—that paying attention to where the Chinese government has its representatives participating in multilateral institutions is a really important thing to do. We don't always pay enough attention to that. We actually keep a list on our website of the roles that Chinese government representatives are playing.

Yes, I would say the WHO needs some reform. Some of it is actually protecting the staff to make sure they can do their jobs.

[Michael Chong, Conservative, Wellington—Halton Hills, ON]

You recently indicated publicly that in the upcoming year you will be looking closely at U.S. investment in China to make sure that investors in the United States are not pursuing investments that are in direct opposition to U.S. national and economic security.

Do you think the Canadian government should be doing the same?

[Carolyn Bartholomew]

I hesitate to tell your government what it should be doing. I am very aware of the sensitivity of our being the neighbours to the south.

Oh, my time is gone.

The answer is yes.

[The Chair, Liberal, Geoff Regan]

It isn't your time, Ms. Bartholomew. It's Mr. Chong's time that's done, but he understands that, I'm sure.

Thank you very much, Mr. Chong.

We'll now go to Mr. Fragiskatos for six minutes.

[Peter Fragiskatos, Liberal, London North Centre, ON]

Thank you, Chair.

Thank you, Ms. Bartholomew, for taking the time tonight.

In listening to your presentation and in reading your analysis of the whole issue of China-U.S. relations, and China's relations with global democracies more generally, I have to ask a very straightforward question here. Is there any hope for any relationship between China and democracies like Canada, the U.S. and other democracies that is—I won't use the word “peaceful” here—not strained? Are we really seeing the emergence of a second cold war?

[Carolyn Bartholomew]

The response to that.... I'm trying to think of the phrasing that President Biden—I was going to say President Obama—has said. There are areas where we are going to compete; there are areas that are going to be confrontational; and we have to figure out areas where we could work together, also.

It's not always easy to define those. I think the Chinese government is excellent at trying to pit one country against another, one industry against another, and one issue against another. Some of us here are watching with a little bit of concern the discussions that are going on about climate change, to make sure that the criticism of what's happening in Xinjiang is not put aside in order to get a climate deal.

The reality is that we have to figure out ways to work together where we can, to disagree where we can't and try to make sure that it doesn't become openly confrontational, which is, of course, the concern about the South China Sea, Taiwan and all of those issues. The reality is that they're here to stay, so are we and so are you, so we have to figure this out.

[Peter Fragiskatos, Liberal, London North Centre, ON]

On that, since you mention it, you talk about possible areas where a relationship can take shape. Well, it's not you; you've talked about the Biden administration and the President in particular talking about climate change. Is this something that democracies like Canada, for example, can look to still work on with China? Climate change is really a global issue and certainly the challenge of our time.

[Carolyn Bartholomew]

Again, I think it's an issue where we have to figure out ways to work together. The Chinese are able to produce things like solar cells at a much lower cost. It has driven the solar cell industry out of countries like the United States, of course, but there are some technologies they can produce that we all need access to.

There has been some interesting analysis here in the United States. Some people are saying, “You know, we keep saying that we need to co-operate with them, but basically the Chinese government knows what it needs to do to address climate change, and we know what we need to do to address climate change.” Working together, of course, would be far more effective and more efficient, but we can't put aside our own responsibilities in addressing it in the hope that somehow we'll all be able to work together on it.

[Peter Fragiskatos, Liberal, London North Centre, ON]

That's understood. Thank you very much.

Do you believe that the Five Eyes allies are aligned in understanding China to be a top security threat and designating it as such?

[Carolyn Bartholomew]

Again, that's an interesting question. I think the Five Eyes is an important institution. Again, here I am, a Democrat, and I think that with President Biden elected it gives us an opportunity to strengthen all of our alliances, which unfortunately went fallow or sour over the past four years.

I recognize that there are different interests that different countries have, including within the Five Eyes, about protecting their economic relationships with China. Again, I think we have to figure out how we can work together in acknowledging that. The economic coercion that China is doing to Australia I think should be a wake-up call for everybody.

[Peter Fragiskatos, Liberal, London North Centre, ON]

That's understood.

I'm told by the chair that I have less than two minutes.

With a final question, how has the U.S. responded to what is taking place in Xinjiang in terms of trade? As you know, and as this committee has heard, on products that would find their beginning in Xinjiang—things like cotton and tomatoes, for example—it's understood by top human rights experts and top experts on trade that forced labour is almost certainly involved in the processing of those products from the beginning and possibly all the way to the finish.

How is the U.S. responding to ensure that products made with forced labour are not entering the U.S.?

[Carolyn Bartholomew]

Well, the U.S. has certainly put some sanctions out and is banning some products from coming in. There was just a recent story that there has been some shortage of ketchup here in the United States. Some people wonder whether it has to do with the packages or whether it has to do with restrictions on importing tomatoes from Xinjiang.

I at least will say that we all have to take action on these things. What is happening in Xinjiang is a genocide. It's a blot on the conscience of the world. I think that, working together, we need to figure out ways so that the products don't just move from one country to another. There are different export markets, so we need to work together on all of those things.

[Peter Fragiskatos, Liberal, London North Centre, ON]

Canada has moved in that direction, thankfully. Of course, there's more we can look at, I think.

Thank you.

[Carolyn Bartholomew]

There's always more.

Thank you.

[The Chair, Liberal, Geoff Regan]

Thank you very much, Mr. Fragiskatos.

Mr. Bergeron, you have six minutes.