Analysts propose more Canadian ties to Southeast Asia amid chill with India, China

Amid a chill in relations with both of Asia’s heavyweights, regional experts say it’s time Ottawa warms up to Southeast Asia, arguing Canada has an edge as a middle power with large institutional investors.

The call comes after years of strain with Beijing, which included the detention of two Canadians in China for more than 1,000 days, and more-recent tensions with India after Ottawa accused its government of complicity in a British Columbia homicide.

“We’re in a bit of a bind; that’s for sure,” said

Wayne Farmer, who leads the Canada-ASEAN Business Council.

“It could be a bit of a mixed blessing.”

Next month, Trade Minister Mary Ng is leading a trade mission to Malaysia and Vietnam, with another planned later this year for Indonesia and the Philippines.

The trips are part of Canada’s efforts to boost commerce with most of the 10 countries that make up the Association of Southeast Asian Nations.

The ASEAN bloc and Canada have pledged to conclude a trade agreement by the end of 2025, and Indonesia has also agreed to have a deal signed with Canada this calendar year.

It’s all part of Canada’s Indo-Pacific strategy, which the Liberals released in late 2022 in an effort to sow closer ties with countries in Asia other than China, deeming Beijing to be a disruptive power that undermines Canadian interests.

Last month, China and Canada both said they’re hoping to work more together, but there are serious differences in how they see relations getting back on track.

The strategy envisioned doubling down on ties with Japan and South Korea while putting an emphasis on tighter links with India.

But relations with New Delhi hit a deep chill over India’s alleged involvement in the assassination of a Canadian Sikh leader last year.

New Delhi temporarily froze visa applications for Canadians, and Ottawa recalled more than 40 diplomats after India threatened to strip them of diplomatic immunity.

With Canada at odds with both giants, Farmer said now is the time to ramp up economic links with Southeast Asia.

“There are only so many resources that Canada has, in people and cash,” he said in a recent interview.

“When things start to change a little bit, or thaw with, say, China, or with India, you’d be able to shift back to focusing on those discussions.”

The Asian Development Bank projects relatively strong economic growth in Southeast Asia, at a rate of 4.7 per cent that puts countries in the region ahead of China, though behind the boom India is currently experiencing.

Dewi Fortuna Anwar, a professor at Indonesia’s National Research and Innovation Agency, said Canada has a strong brand across the region, due in large part to past development projects.

But its engagement in Southeast Asia has been intermittent, she said.

“Canada has never been away, but the perception is that it has not been as visible in the past few years,” she told a recent panel.