Canada-China Relations Committee on June 19th, 2023

[Alexis Brunelle-Duceppe, Bloc, Lac-Saint-Jean, QC]

That's pretty surprising. If I understand correctly, when you invest in businesses operating in countries that are under the yoke of a dictatorship or that are considered authoritarian, run under laws that violate fundamental human rights, you follow the exact same approach as when you invest in democratic countries. Is that accurate?

[Paulo Martelli]

We invest in private sector companies in a variety of different countries. In the type of country you described, there are very few opportunities to invest in the private sector, so the odds of our doing very much in those types of countries are going to be very low.

If we were to find a bankable type of transaction in those kinds of countries, we would take the same thorough approach to the analysis of human rights risks and so forth.

[Alexis Brunelle-Duceppe, Bloc, Lac-Saint-Jean, QC]

I'd like to ask one final question very quickly. Has FinDev Canada ever invested in a country that's under a dictatorship or considered authoritarian?

[Paulo Martelli]

I don't believe so. I don't know what your definitions are of those different aspects, but I don't believe so.

[The Chair, Liberal, Ken Hardie]

Thank you.

[Alexis Brunelle-Duceppe, Bloc, Lac-Saint-Jean, QC]

Mr. Martelli, if ever we go for coffee together one day, I'll explain to you what a dictatorship is. You'll see that it's fairly straightforward.

[The Chair, Liberal, Ken Hardie]

Welcome Mr. Boulerice. You have two and a half minutes.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

Thank you very much, Mr. Chair, and thank you for welcoming me to your committee somewhat at the last minute.

I think I'll continue along the same vein as my colleague Mr. Brunelle-Duceppe. What are the criteria that determine the way that FinDev Canada invests in foreign countries?

[Stéphanie Émond]

Thank you for the question, Mr. Boulerice.

We can invest in any country that's eligible for official development assistance. Some of the criteria we follow are the nature of the companies, financial institutions, and funds in which we're looking to invest, so that we can ensure that they'll help us reach our objectives in terms of impact and that they're able to absorb our investments, which generally range from $10 million to $60 million.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

Do you invest or spend any money in China?

[Stéphanie Émond]

No, we don't invest in China.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

What are the criteria you use to determine if you're investing in a state that's under a dictatorship, or a country where democracy or freedom of speech are lacking?

[Stéphanie Émond]

A country where human rights or freedom of expression are under threat will present increased risk. So we'll carry out enhanced due diligence and background checks. For example, if we can't rely on local media to ascertain a given company's reputation, we'll have to rely on other information sources.

As my colleague was saying, in order to meet our objectives in terms of impact, we'll look closely at our client's backers, its performance, including in terms of managing environmental and social risks, as well as its transparency and governance.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

Thank you for your answer. I'd still like to remind you of your colleague's previous answer, because it would seem you're not saying the same thing. It might be a good idea for you two to talk.

[The Chair, Liberal, Ken Hardie]

Thank you, Mr. Boulerice.

We have two more slots. The first of them will go to Mr. Fast.

You have five minutes, sir.

[Ed Fast, Conservative, Abbotsford, BC]

Thank you, Mr. Chair.

My questions are primarily for Ms. Meyerhoffer.

Your most recent quarterly report referenced 15 cases that are ongoing.

Is that correct? Is 15 the total number of cases since your position was established?

[Sheri Meyerhoffer]

Fifteen is the total number of cases that we have found admissible and that we are reviewing.

[Ed Fast, Conservative, Abbotsford, BC]

All right.

Of those 15, 13 emanate out of the PRC.

Is that correct?

[Sheri Meyerhoffer]

The honourable member is correct.

[Ed Fast, Conservative, Abbotsford, BC]

Effectively, most of your time is consumed by addressing human rights challenges regarding Canadian companies doing business in or with China.

Is that correct?

[Sheri Meyerhoffer]

Currently, that is correct.

[Ed Fast, Conservative, Abbotsford, BC]

When an importer wants to import from China, there's a declaration they sign.

Do you expect that declaration to have much impact on the enforcement of our human rights requirement?

[Sheri Meyerhoffer]

I go only by what the previous panel said, and I noted in that testimony that when someone refused to sign that declaration, they were not provided with trade services.

[Ed Fast, Conservative, Abbotsford, BC]

Sure, but if someone makes a false declaration, who follows up on that? I'm assuming it's not your office.

[Sheri Meyerhoffer]

No. We would follow up only if we received a complaint.