Foreign Affairs Committee on April 17th, 2018

[The Chair (Hon. Robert Nault (Kenora, Lib.)), Liberal, Bob Nault]

Colleagues, seeing that the clock shows 3:30, I call the meeting to order. Pursuant to Standing Order 108(2), we are studying Canada's engagement in Asia.

In front of us today as witnesses are, from the Asia Pacific Foundation of Canada, Stewart Beck, president and chief executive officer, who's by video conference live from Vancouver, and as individuals, James Boutilier, adjunct professor, Pacific studies, University of Victoria—welcome to Mr. Boutilier—and Marius Grinius, fellow at the Canadian Global Affairs Institute and former Canadian ambassador. It's always nice to see our former ambassadors visit.

As always, we want to hear your perceptions of Asia, and generally we then get to questions by our colleagues. I'm not sure who's decided to go first. I think it's Mr. Beck by video.

We'll turn the floor over to you, Mr. Beck.

[Stewart Beck, President and Chief Executive Officer, Asia Pacific Foundation of Canada]

Thank you very much, Mr. Chair.

Thank you to the committee for the opportunity to appear today to discuss the important issue of Canada's engagement with Asia.

My name is Stewart Beck. I am president and CEO of the Asia Pacific Foundation of Canada, a not-for-profit organization established by an act of Parliament in 1984, and a leader in the research and analysis on Canada-Asia relations for over 30 years. Our mission is to be Canada's catalyst for engagement with Asia, and Asia's bridge to Canada.

First, let me provide a brief overview of my Asia-related background and experience. Prior to joining APF Canada, I served as Canadian high commissioner to India, with concurrent accreditation as ambassador to Bhutan and Nepal. I joined Canada's Department of External Affairs and International Trade, now Global Affairs Canada, in 1982. I served abroad in the United States, Taiwan, and the People's Republic of China. I was consul general in Shanghai, and prior to my posting to India, I was consul general in San Francisco. In Ottawa, I held a number of senior positions, including director general of the North Asia bureau; director general responsible for senior management and rotational assignments; and assistant deputy minister for international business development, investment, and innovation.

Today let me start by underscoring the importance of Asia to Canadians and to Canada. My focus will be on economics and non-traditional security threats, as there are two very competent and capable witnesses speaking with you today who will, I'm sure, address security issues in the region. They are my former colleague Marius—it's good to see you, Marius—and my good friend Jim Boutilier.

The rise of Asia marks one of the defining shifts of the 21st century. Asia will soon represent 44% of the world's gross domestic product, 54% of the global middle class, and 42% of the world's total consumption. As we consider the region it is important to remember that while China is certainly the player to watch, Asia is not a monolithic entity. Asia is not China; it's a region comprising multiple types of economies, styles of governance, and geopolitical realities. A one-size-fits-all approach will not advance Canada's interests in the region.

The growing significance of Asia underscores the need for Canada to strategically deepen and diversify its existing partnerships in the region, which is a fast-changing, complex, and increasingly competitive environment. The timing could not be better. The wave of isolationist, national rhetoric that has been sweeping the U.S. and Europe has sent a chill through legacy alliances and trusted relationships in the Asia Pacific. As these countries look for new friends, Canada is receiving renewed attention for its social and economic openness, transparent business culture, and good governance.

I am pleased to see that the Government of Canada is responding to this dramatic global shift by accelerating its engagement with Asia, making trade with China and India a pillar of its overseas agenda, and launching foreign trade missions and negotiating free trade agreements with renewed enthusiasm. My colleague Hugh Stephens will speak in more detail to you later today about these initiatives, but we are all encouraged by the renewed activity around CPTPP, China, ASEAN, and of course, NAFTA.

To date, Canada has been fortunate to have sources of growth and stability in traditional partners such as the United States and Europe. These partnerships should not and must not be ignored. But the Government of Canada has a pressing opportunity to articulate a more targeted and strategic approach to engaging Asia that both advances Canadian national interests and contributes to the sustainable development and growth of the region.

To assist the Government of Canada in this endeavour, APF Canada released a strategic paper over a year ago that outlines a series of recommendations for the government to consider as it articulates its response to the rise of Asia. The strategy paper is entitled “Building Blocks for a Canada-Asia Strategy” and is available on our website. We've identified five key drivers of change and growth in the Asia Pacific region and the challenges and opportunities they present for Canada. Today I'd like to focus on two: technology and innovation, and demographics.

Perhaps the most significant development in the Asia Pacific this decade is the socio-economic levelling effect of the Internet. The increase in Internet usage is completely transforming domestic and traditional market economies into global and digital ones, as we see in the recent upsurge in e-commerce sales. From 2013 to 2018, Asia's e-commerce sales are expected to double to $854 billion. In China alone, the e-commerce market has grown 50% annually since 2011 and has already passed that of the United States to become the world's largest online market.

Meanwhile, Asia is rapidly becoming a global hub for technology and innovation. Asian businesses and governments are looking for opportunities to learn from partners in Canada how to establish healthy innovation ecosystems and how to catalyze entrepreneurship. The Government of Canada's investment in innovation superclusters is a strong domestic growth strategy, but imagine if we align these domestic investments with our relationships in Asia.

A redefinition of demographics in Asia is another driver of change in the region. In developed economies such as Singapore, Hong Kong, Taiwan, South Korea, and Japan, elderly populations will soon dominate. Investment boosts in national pensions, health care, and research in medical technology have already started as governments prepare to meet the demands of the elderly. We must ask ourselves how Canada can leverage its own expertise to take advantage of these new opportunities.

Developing countries in south and Southeast Asia, on the other hand, are experiencing youth bulge populations, with almost half of the Southeast Asian population expected to be under 30 years of age by 2020. In the same year, India is projected to become the world's youngest country, with 64% of its population in the working age group. Canada can help address the shortage of skilled workers in south Asia and parts of Southeast Asia while also helping governments address the potential risks associated with large unemployed youth populations.

Meanwhile, middle-class growth and urbanization in Asia create a further set of opportunities and challenges for Canada. Higher-earning households can now spend greater amounts on international travel and luxury items, many imported from abroad. Asian parents are sending their children overseas for a higher education, primarily to welcoming, English-speaking western countries like Canada.

We have also seen a positive trend in the rising demand in food products imported from trusted sources. Wealthier populations, particularly in India, are simply eating more vegetable proteins like pulses every day, with associated pressures on regional water security becoming increasingly urgent.

On the home front, research and surveys conducted by APF Canada over the past 10 years indicate that there is a knowledge gap among Canadians regarding countries in Asia and that few Canadians have been exposed to Asia or Asian business culture. To narrow this knowledge gap, we must invest in young people, supporting programs for youth to study and work in Asian countries. Canada's youth are keen for the challenge. Our latest APF Canada national opinion poll on Canadian millennials' views on Asia found that millennials are more positive about Asia in general and more engaged with the region through work, travel, language, and social networks than generation X, the baby boomers, and the older generation. The good news for the Canadian government is that our millennials are more likely to be receptive to a pro-engagement policy than their elders. Younger millennials, in particular, tend to be more open-minded and interested in the Asia opportunity. This poll can be found on our website.

In summary, Asia has just not been on our radar screen, and we have had little or no reason or desire to connect. The result is that our market share of total imports in Asia is 1.02%. The share in Australia and Germany, by comparison, is almost 4%, and for the U.S. it is almost 10%.

The time is now for us to diversify our interests and pursue the growth opportunities perceived by the Asian century. To do so, we will need a strategy and the Government of Canada's leadership in the development and implementation of the strategy.

Thank you for allowing me to spend a few minutes with you today.

I am happy to take any questions.

[The Chair, Liberal, Bob Nault]

Thank you, Mr. Beck.

We will go to Mr. Boutilier, please.

[Dr. James Boutilier, Adjunct Professor, Pacific Studies, University of Victoria, As an Individual]

Thank you very much, Mr. Chair and members of the committee.

I would opine editorially that we're about 30 years late. We should have been having this discussion back in 1990. It's astonishing to me that the profundity of the transition from the Atlantic to the Pacific is only now effectively being addressed. President Beck captured, in his elegant tour of the horizon of the geostrategic and economic outlook in Asia, the fact that Asia is now appearing on our radar screen. It's astonishing when you think that back in 1980 China was the 17th largest economy on the face of the earth and now it's arguably the second- or third-largest economy on earth. Where were we? Frankly, ladies and gentlemen, we were asleep at the switch.

I would suggest that historically Canada's engagement in Asia has been tardy, inconsistent, and ineffective. We have simply not risen to the challenge. In defence of Canada, we could say that the overwhelming dependence on the U.S. market, ties across the Atlantic, and institutional responsibilities to NATO and other organizations have deflected us from Asia. However, ironically, within Canada the national centre of gravity is moving westward relentlessly, and Asia, as reflected in this very committee, has in fact arrived in Canada. The Asianization of the urban settings and complexes of Canada is very much a contemporary phenomenon, and it's a very good thing as well.

In defence of Canada, our involvement in Afghanistan and in NATO commitments have deflected Ottawa's attention from the magnitude of what's happening in Asia. As an organization, I would suggest that DFAIT, or DFATD, or GAC has become progressively weaker and less influential in shaping the nation's engagement strategy in Asia. We have not had vision and leadership. This is not for an instant to overlook the dozens of small and medium-sized enterprises that are in fact doing business in Asia. Asia is not an easy place to do business in many cases, but there are enormous opportunities.

I would suggest to you that there has been a disturbing paucity in the number of foreign policy statements over the years that have come to grips with Canada and Asia. The fact is that we live in a state of deficit now in terms of an overarching foreign policy. Our defence review is absent any foreign policy that focuses on Asia. Indeed, were we to look at the defence realm and go back to 1971, the paradox is that, when we analyze policy documents on Canadian defence, we see that by 1990, at the very time that Asia was taking off relentlessly in a stellar manner, references to Asia virtually vanished from defence department documents. There's almost nothing of substance about the importance of engaging Asia, and I suggest a little later in my presentation that the defence department has a key role to play.

The Prime Minister's recent sorties to Asia—Vietnam, China, India—can only be described as colossal failures. Someone should be hanged by the thumbs. This is appalling in this age and stage of our national engagement in Asia. This of course begs some serious questions. Who organized this? Who executed it? It's astonishing to me. To leave Prime Minister Abe standing at the altar in Da Nang was appalling in terms of establishing our credibility.

I would suggest that this government, perhaps more than the previous one, is trapped between a commitment to Liberal values and the practicalities of forging economic relationships with increasingly unsavoury polities in Asia. Asia is very dynamic, very attractive, and very seductive, but as we all know, the human rights record in some Asian countries is little short of appalling. To what degree do we allow our economic engagement to be held ransom by interlocking it with a values system?

Disaggregating these two strategies at a time when the global community is becoming increasingly polarized on the issue of values will be one of the government's greatest challenges. While the missionary impulse is powerful and deeply seated in Canada, it is doomed to fail. One of the greatest realizations to emerge from the past quarter century is just how naive western policy-makers were in expecting China's value system to be transformed along western lines as it grew economically. The very opposite occurred.

Should we abandon our values? Not for an instant. That's not what I'm recommending. What I'm suggesting is that we have to be extraordinarily clear in our minds in establishing our priorities of what agenda we are advancing when we engage certain countries in Asia. Certain countries in Asia are becoming more difficult, more unsavoury, every day.

As president Beck has suggested, while the amount of Asia-Pacific trade has grown steadily over the past quarter century, Canada's market share has continued to decline. We can see that it's barely the width of a pencil line, despite the efforts of many Canadian companies. One of the challenges, of course, is that Canada has a population equal to one of the major cities in China. There are no big corporations in Canada to speak of, perhaps the Bombardiers and SNC-Lavalins notwithstanding. It's difficult to compete, but that's the reality.

Pragmatism and prioritization should be the guiding principles in our engagement with the region. We have many other arenas in which to realize the values which underpin our Canadian democracy. I suggest that the Canadian Armed Forces and the Royal Canadian Navy—not because I work for the navy, but because it is a vehicle of national power that is remarkably flexible, in every sense of the word—should be instruments in telegraphing Canada's commitment to the region. It's not enough simply to send ships to Asia; we have to do it in an orchestrated way which maximizes the value in terms of a full array of other activities.

This is an era when interstate relations are being played out at sea in Asia, when there's a naval arms race under way in the region, and when militaries, serving or retired, play an extraordinarily important role in the region's affairs. This is something we tend to forget, the degree to which militaries, in and out of uniform, are in fact major opinion-makers in many of the policies we're dealing with.

I would suggest, ladies and gentlemen, that ASEAN, much to my regret, is roadkill. The irony to me is that at the very moment that ASEAN has achieved community status, it has in fact been hopelessly fragmented and undercut as a result of Chinese money and politics. One only has to look at the state of Laos, Cambodia, and increasingly Malaysia, and so forth, to realize that the community, which was one of the major balancing elements in the larger geostrategic landscape of Asia, has reached the point of near failure, at least to to my mind. That is not to suggest that there aren't economic opportunities for Canada. In fact, in many cases, the scale of ASEAN countries is much more attractive to Canada than, for example, China or even India. But my own feeling is that a tragedy is unfolding in ASEAN as we speak.

In conclusion, I would suggest that Canada has a profound branding deficit in Asia. Canadians are seen as nice people, but frankly irrelevant. The question asked in the region is, are the Canadians really serious about being engaged in Asia? We have not followed some simple precepts: you have to be there consistently, you have to build relationships, you can't butterfly in and out on the grounds that it's a long way from Ottawa, whereas London, Frankfurt, and Rome are just overnight trip away and that when you get off the plane you know people.

Sadly, Asia, in many cases, I think is subconsciously in the all-too-difficult file. It's so much easier when you're dealing with Houston or Milwaukee. You don't have to worry about language or the regulations or the currency, and so forth. It's not easy in Asia, but we're missing enormous opportunities, we're deluding ourselves, and this is the sort of discussion we should have had 30 years ago.

Thank you very much.

[The Chair, Liberal, Bob Nault]

Thank you very much, Mr. Boutilier.

We'll go to Mr. Grinius, please.

[Marius Grinius, Fellow, Canadian Global Affairs Institute, Former Canadian Ambassador, As an Individual]

Thank you very much for the invitation.

In terms of my own credentials with respect to Asia-Pacific, I've had five postings to the region, including as ambassador to Vietnam and to North and South Korea concurrently. Somewhere in-between, I was also the director for Southeast Asia. With respect to security issues, I was the ambassador to the United Nations in Geneva, dealing with refugees, human rights, humanitarian relief, and the entire gamut that Stewart referred to. Also, I was the ambassador to the Conference on Disarmament. My last assignment before retiring was to the Department of National Defence, as the director general for international security policy.

With the eight minutes allotted to me, I'd just like to make a few observations regarding Canada's engagement with the Asia-Pacific region. Your goal is to identify areas where Canada can deepen its engagement in the region, and that's a good goal. Ensuring that Canada's engagement is coherent and consistent is the big challenge, and I note that the last extensive foreign policy review of Canada and Asia-Pacific was done by the Senate Standing Committee on Foreign Affairs back in 1998. It was called “The importance of the Asia Pacific region for Canada”. The Senate also did an update on Southeast Asia in 2015. They are still good documents to read.

My first observation is in the global context, where I believe that there is a new great game being played out between an ascendant China and a United States in retreat. I would argue that the U.S. and now China are Canada's two most important bilateral relationships—for different reasons, but they are the top two in my eyes. However, Canada must be prepared for more global turbulence as these two powers compete in trade, hard power, and soft power in order to establish what could be a new modus vivendi between them, or even perhaps a new global order. In this new great game, China is being assisted by its junior partner, Russia.

Since your visit to Beijing, Xi Jinping, of course, has enacted constitutional amendments, a very important one, and as The Economist put it recently, “China stepped from autocracy into dictatorship”.

My second observation is about the Asian paradox. It refers to the ironic situation whereby, despite Asia's growing economic interdependence, the level of political and security co-operation there remains low. Despite incentives for even greater prosperity within a predictable and peaceful environment, the potential military conflict can certainly jeopardize Asia's economic successes, with global implications. You're well aware of the security issues: South China Sea, the East China Sea, India, Pakistan, and Taiwan. Perhaps most pressing right now is North Korea.

Canadian trade commercial interests remain at the top of the Asia-Pacific foreign policy agenda, but I believe there is a need to pay attention to Asia's security dimension, and for Canada to contribute to a robust Asia-Pacific security architecture, if only out of self-interest. Singapore's defence minister just talked about the security architecture yesterday at an ASEAN conference.

Of course, I would suggest that Canada's contribution would be regularly showing the flag in the region, regular high-level political-military talks, and perhaps resuscitating Canada's role in track two discussions, where Canada was front and centre in the 1990s and early 2000s. Certainly Canada can also play a role in terms of the human rights dimension, whether we're talking North Korea, the Rohingya, China writ large, or about extrajudicial killings in the Phillippines.

My third observation is on North Korea. You're aware that there's a frenzy of related summits about to take place in the next few months. Prime Minister Abe is meeting President Trump today, and North Korea is high on the agenda.

I am in the school that believes that Kim Jong-un will not negotiate away his nuclear weapons, and that there's not going to be a really fundamental change in the situation until China admits that North Korea is a strategic liability for China's global ambitions.

Canada has been, unfortunately, a marginal player on the North Korea file ever since the Harper government decided back in 2010 that it would have a short-sighted policy of “controlled engagement”. The Trudeau government has allowed that policy drift with respect to North Korea to continue even as the geopolitical landscape is rapidly changing but remains highly dangerous and unpredictable.

I understand that you will be going to Japan and South Korea next, both of whom are strategic partners for Canada. I think you will find the Japanese very wary of what is happening on the Korean peninsula, and perhaps the South Koreans overly optimistic. You may wish to ask both hosts if there is a role for Canada, but you will have to dig beyond the usual politesse to get some straight answers from both of your hosts.

One obvious starting point for Canada is for Canada's ambassador to Seoul to once again be cross-accredited to Pyongyang. You have to be there. You have to know what's going on. You can't rely on somebody else telling you what's going on.

My fourth observation is on Canada and ASEAN. You have already travelled to Indonesia. You met the secretary general of ASEAN. You know the history of Canada's dialogue partnerships in 1977 and our being one of the partners of the ASEAN Regional Forum. But when ASEAN inaugurated the first East Asia Summit back in 2005, Canada was not invited. When ASEAN decided to expand their defence ministers' meeting to include EAS members, again Canada was not there. Prime Minister Trudeau certainly asked, and almost pleaded, in Manila to join, but this has been a message from Canada for a long time. I believe ASEAN is not quite convinced of Canada's commitment to Southeast Asia, or to Asia for that matter, but our ASEAN friends, whom I know very well, I believe, are too polite to tell us.

Canada certainly must demonstrate a serious long-term track record of participation in ASEAN's strategic security problem priorities, but the Asian way requires frequent and consistent face time. Personal relations are very important.

Back in 1995, Foreign Minister André Ouellet actually consulted them. He invited all ASEAN foreign ministers to Vancouver in preparation for the G7 Halifax Summit. I thought that was a pretty good idea, but I don't think any Canadian G7 hosts subsequently, including for the G7 Summit coming up very shortly, have asked ASEAN its opinions.

One caveat, and Jim has mentioned it, is that ASEAN, I believe, is drifting further into a club of authoritarian regimes. In this context, it will be important, I believe, to strengthen relations with both Indonesia and Singapore.

As a last observation, and as my bottom line, I'll say that Canada is already a strong economic player in the Asia-Pacific region. It could certainly be stronger, but it's there. It has deep social, cultural, and historic roots there, but it must not really demonstrate a stronger, more-consistent commitment to Asia-Pacific stability and security. I think it is in Canada's interest to do so.

Thank you.

[The Chair, Liberal, Bob Nault]

Thank you very much, Mr. Grinius, and to all three witnesses.

Colleagues, we'll stick pretty close to the time limits so that we can get in as many questions as we can.

Mr. O'Toole, you're on.

[Erin O'Toole, Conservative, Durham, ON]

Thank you very much, Mr. Chair, and thank you very much to our witnesses today. There's been some very compelling testimony. It is nice to see two of our former ambassadors still very much engaged in dialogue with Canada and our allies around the world. Thank you for continuing to help us advance that.

I have a couple of questions for Mr. Beck and Dr. Boutilier.

Mr. Beck, regarding the 19th people's congress and the refocusing of the Chinese leadership on state-owned enterprises, we're facing a number of situations in Canada where increasingly, the ability of Chinese state-owned enterprises to acquire Canadian companies can cause some difficulties with regard to the direction that the U.S. is taking, possibly complicating the Canada-U.S. trade relationship with our willingness to approve these large transactions. Aecon is the one in the news now, but there were some security ones previously.

Where do you see this going? It seems that with the 19th people's congress, China's government is reinforcing its use of state-owned enterprises as a foreign policy tool.

[Stewart Beck]

I would agree with you in the context of the role of state-owned enterprises. What's also a bit disturbing from the 19th party congress is the fact that there are now party members on boards of private companies as well. These are not the signals that you want to send to the western world in particular, because they cause some concerns.

State-owned enterprises have been around for a long time. Some have given us concern, particularly when they make investments in our natural resource sector. If you take a look at our polling—we did a poll two years ago on foreign direct investment from Asia—the one area that Canadians are quite concerned about is state-owned enterprise investment in the natural resource sector. Only 11% of Canadians supported that. So I think you've hit on a key note.

With respect to Aecon, I see that as a opportunity for Canada. CCCI has invested in a similar type of company in Australia. That investment has gone well. They've added more people. They've kept the management structure. The investment has provided opportunities for this Australian firm in other markets in Asia.

This type of merger can serve as an entree for Canada into the one belt, one road projects that will be taking place. There's lots of money and investments being attached to this. I think we have to be judicious in how we look at these investments from state-owned enterprises. There are policies in place, with the Investment Canada Act, and also our national security interests. We need to go through these processes to examine them and understand whether or not they will have an impact.

To be honest with you, sir, some of my concerns are more in the technology side, particularly moving forward in artificial intelligence, PIN technology, big data management. We need to be aware of that and understand it, how it will impact, because we have a lot of very good young technology companies that are open for merger and acquisition. We just need to understand it. It's something we should be spending a lot of time on as well.

[Erin O'Toole, Conservative, Durham, ON]

Those are some unique risks in that sector. Thank you.

Dr. Boutilier, I think you're right: the three-ocean navy, because of the rise of the Pacific, was part of the 1987 defence white paper. These intentions were there 30 years ago, but there was no follow through, and that's a challenge that we face.

Could you speak for a moment about the military capability of China, particularly its blue-water navy capability, and how that is changing—particularly with the construction of islands in the South China Sea—the security of trade routes and just the global balance within the Asia Pacific with respect to naval force, troop movements, that sort of thing?

[Dr. James Boutilier]

Thank you. That's an extremely important issue. I think what many Canadians fail to appreciate is that in the last third of a century, a navy that is numerically as large as the United States Navy has suddenly appeared on the global scene. Just think about that. As I've said to this committee, I think, on previous occasions when I was a young navigating officer in the Royal Navy long ago, the Royal Navy had 152 frigates and destroyers. Now it has 19. The United States Navy has been cut in two numerically since the mid-1980s, the time of Ronald Reagan.

Now what we have is a new great game. Ambassador Grinius referred to it and I think he's absolutely right, but much of that I would suggest to you is going to be played out at sea. What we see is a country that has never paid attention historically to the sea, who saw the sea as a barrier and saw existential threats originating out of Asia, now embracing sea power as a critical instrument of state policy. You can see the shift within China's continually burgeoning defence budget, which has been rising 8%, 9%, 10%, 11% a year for the last 30 years. The reference was just made to the belt and road initiative, Xi's grand, pharaonic undertaking. This is something that I would suggest is entirely new. It's not to suggest that the Middle Kingdom construct has been abandoned, but China is now beginning to reach out beyond its borders in a way that it has never done historically, and the navy is one of the key elements.

What do we see? We see a growing contest in the western Pacific between the United States Navy and the Chinese and, of course, now, with the reference to the Indo-Pacific, we see the Indian Navy struggling to match the rise of the Chinese navy, this grand contest unfolding at sea. Other navies—Japan, South Korea's, and so on—are all beginning to position themselves alongside Americans, Australians, and Indians for some potential contest at sea.

The South China Sea is a complete exercise in highway robbery. This is enough to make a 19th-century British imperialist blush. Here are Marxists taking over territories that simply do not belong to them, and the arguments they advance are completely bogus. But the fact of the matter remains that, like Putin in the Crimea, Xi carefully calibrated the western response and realized that no one would in fact challenge the building of artificial islands in the South China Sea—and, of course, he has simply ridden roughshod right over the International Court of Justice ruling that came down in July 2016. He simply ignored it. That's one of the real threats that we see in the larger order, with nations like China and Russia simply ignoring international order, where lying is a fundamental pillar of the foreign policy.

What the Chinese have done is consolidate their approaches to one of the critical areas of China from a maritime and naval perspective. They now control the South China Sea. It's their lake.

[The Chair, Liberal, Bob Nault]

Dr. Boutilier, we're going to leave it there.

[Dr. James Boutilier]

My apologies, Mr. Chair.

[The Chair, Liberal, Bob Nault]

No problem. We'll get back to that. I'm sure you'll get a chance to double back as we go.

I want to turn it over to Mr. Levitt, please.

[Michael Levitt, Liberal, York Centre, ON]

Thank you, gentlemen, for your analysis.

As a committee we had an opportunity to visit China, Vietnam, and Indonesia in December. As you know, we're travelling to South Korea, Japan, and the Philippines in May.

I want to start with the issue of human rights, because it's one that I think at least two of you mentioned. It presents a dilemma and a challenge, and we faced that challenge when we were in China, particularly. At all three of our stops, we raised issues of human rights. We had discussions, some more successful than others, on issues of religious freedoms, freedom of expression, democratic values, and political repression. You can imagine how some of those conversations went.

There's an expectation by Canadians that Canada is going to continue to get the message out and be a beacon of human rights and those universal values, and yet, of course, Dr. Boutilier, you mentioned the problem when trying to move ahead in dealing with economic agreements and that sort of thing.

Maybe I'll start with Mr. Grinius, first. How do we align the two? Moving forward, how do we approach, from your perspective, the issues of human rights and the need to be forming and building foundations of trade agreements?

[Marius Grinius]

It's a tough slog. You've got so many authoritarian dictatorships out there, and they don't like hearing what I believe should be a fundamental Canadian consistent message of concern. This is not only because of Canadian values and all of those sorts of good things, but there is a human rights statute that everybody has signed on to at the United Nations. I do believe we have to live up to those requirements. How one does it is obviously the challenge.

When I was ambassador to Vietnam, I had what often I would call frank and fraternal exchanges of view on human rights. I had a checklist, actually, of individuals who were of concern to Canada and the global sort of community at large; and I believe one had to be consistent in conveying those concerns at the right levels. I did the same with North Korea when I presented my credentials. It was nuclear proliferation and human rights that were my two main talking points with senior people there. I believe that has to be a consistent Canadian message at high levels. We're going to get hammered. Canada will get hammered once in awhile, as you know, but that's fine.

One last thing is the UN Human Rights Council. I was the Canadian representative when that council was formed, and Canada was a member for the first three years. I did the second two, including as vice-president. I notice that Canada has not tried to become a member of the Human Rights Council since my time there, which was in 2005. Why is this? I think there's a global issue in terms of human rights that has to be addressed, and Canada is not there. Russia, China, and Saudi Arabia—those great defenders of human rights—are consistently there as voting members, and I think we have to be there also.

[Michael Levitt, Liberal, York Centre, ON]

Just on that point, one of the concerns I certainly have, and I chair the subcommittee on international human rights, is that the work in the Human Rights Council is often disproportionately focused in areas...and does not look back at some of the challenges facing those countries, because with the nature of the voting blocks, it gets whitewashed. I think there's frustration. I certainly am frustrated with that. I don't know if that's the issue at hand, but....

[Marius Grinius]

There were times when I was a member that the voting score was 46 to one, and I felt that I had surrounded the other 46 members who voted against a Canadian motion, but it had to be there.

[Michael Levitt, Liberal, York Centre, ON]

You got it on the table. That's good.

Mr. Beck, just on the human rights issue, did you want to add anything on how to approach it? With Canada being out there, what's our obligation?

[Stewart Beck]

We have an obligation. I look at it as a short-term and a long-term issue. The short-term one is that we do what we do consistently, and in my career particularly, when I was in China, these were issues that we constantly raised with the Chinese. How it was done depended on whoever was providing the talking points, or whoever the leader was at the table at the time, but it was consistently raised.

The longer term approach is really when you take a look at the number of foreign students from Asia who are now in Canada, particularly from China and India. It goes back to the point I made about millennials and having a millennial strategy. These are young students who are exposed to Canadian values, understand the system, are normally in the country for four years, sometimes longer, and get to understand that. How do we bridge to that generation in a place like China? Also, India is not without its issues as well, let me tell you, from my own experience there. I think this is how we, on a longer term basis, should think strategically about influencing the next generation.

[Michael Levitt, Liberal, York Centre, ON]

Thank you.

[The Chair, Liberal, Bob Nault]

We'll now go to Madame Laverdière.

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

Thank you very much, Mr. Chair.

I want to thank all three of you for appearing before the committee today.

Mr. Grinius, you referred to Russia as a junior partner, which I find quite interesting. Looking at what is happening on the UN Security Council, it seems that China is more reserved and that the bigger debates and issues are between the Americans and Russia. You presented quite a different picture, which I find very interesting.

Can you elaborate on that please?

[Marius Grinius]

I've seen the Chinese-Russian connection and the tag team they played in the Human Rights Council, certainly in areas of nuclear arms control, and from a greater distance, the Security Council deliberations, particularly with respect to North Korea. It has been fascinating there to see their tactical use of the veto and watering down of what should be relatively straightforward Security Council resolutions, including on all the sanctions issues.

In the context of what some people, including me, call the “new great game”, I believe it is in Chinese and Russian self-interest to keep the United States geopolitically off-balance. So you have Chinese warships on exercise with Russian warships in the Baltic, the Mediterranean, and the Black Sea. You had Russian ships with Chinese ships in the Pacific. This is the strong messaging and you see it played out in the diplomatic world. You see it in practice in the military world. The first visit by the new Chinese defence minister was to Moscow and he said very openly that they were there to work with Russia in their interests. That certainly gets played out in so many different ways.

There are times, I believe, in the context of, say, anti-terrorism, that it's in the interest of everybody to play and co-operate together, but that's in a very short-term way as opposed to the long-term way that these two countries are playing.

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

Mr. Boutilier, you said that defence has a role to play in the Asia Pacific. I would like you to elaborate on that please.