PM fails to export trade agenda
So why insist on strategy that isn’t working?
Justin Trudeau’s last day in China started with an eye-dotting ceremony, the tradition of marking the eyes of dancers’ lion costumes with symbolic blood.
Chinese tradition suggests the dots — red, symbolizing fire, life and good luck — awaken and tame the lion.
The ceremony also gave birth to a thousand tortured metaphors from my colleagues about how the prime minister had failed to tame the Chinese and persuade them to fall into line with his progressive trade agenda.
Trudeau left China without the agreement to launch free trade talks that had seemed so feasible on his arrival in Beijing, though in his closing press conference Thursday the prime minister declared victory.
“We have taken positive steps toward a strengthened partnership. We have made a lot of progress,” he said.
But that’s a perspective unsupported by the facts.
The Canadian delegation arrived in the belief that the Chinese had agreed to a framework that included separate chapters on the environment, labour standards, state-owned enterprises and public procurement — pre-conditions laid down by Trudeau during his visit last year, and apparently accepted by the Chinese.
However, while Chinese trade officials may have deemed the progressive trade agenda copacetic, it was not acceptable to Premier Li Keqiang, with whom Trudeau met Monday. This raises obvious questions about the advice the Prime Minister’s Office was getting from its embassy in Beijing, and in particular from its ambassador, former Liberal cabinet minister John McCallum.
In the event, it was Canadian demands on labour standards that proved the stumbling block.
Ottawa wanted their inclusion as the starting point for negotiation; the premier interpreted the pre-condition as a slippery slope toward an equivalent of the Canadian Labour Code, with its provisions for collective bargaining and occupational health and safety standards.
The two sides spun in circles on this point for days, and time simply ran out.
The prime minister explained the reasoning behind his hard line during Thursday’s press conference. “Trade deals must benefit citizens, not just multinationals or a country’s bottom line,” he said. “That is the only way to move forward effectively.
“The alternative is no trade deals at all because of the rising feelings of inward thinking, fear, protectionism and nationalism.”
Needless to say, the “citizens first” view is not shared in a country that is determined to shake off centuries of Western hegemony and chart its own course.
“We are not asking Ottawa to share the same ideas as us,” said an editorial in the state mouthpiece Englishlanguage newspaper the Global Times. “China is not in a rush to develop its trade with Canada.”
The Chinese would like to strike a business deal similar to the one reached with Australia. They clearly do not want to import Trudeau’s “progressive” values.
An agreement was close after Li and Trudeau dined together Monday night — there were suggestions that one may even have been signed on Tuesday, before Trudeau met Chinese president Xi Jinping.
But the prime minister left China empty-handed, just as he left Vietnam last month having failed to conclude the Trans-Pacific Partnership deal.
With the North American Free Trade Agreement also up on bricks, it seems Trudeau’s progressive trade values are in trouble.
The Canada-China relationship will continue to grow incrementally; bilateral trade was up 14 per cent in the first 10 months of this year. But Canadian businesses that met with Trudeau in Beijing made clear the potential for a starburst of activity if tariffs are eliminated and regulations eased. None of them expressed concerns about China’s labour standards or gender-equality provisions.
Labour conditions in China will improve of their own accord as the country moves further up the value chain.
They do things differently here. This week saw the maiden voyage of the new C919 jetliner from Commercial Aircraft of China, or Comac. It is a state-owned enterprise and the jet is viewed as a national project, part of China’s longcherished ambition to regain past glory through the manufacturing process.
This is an $11-trillion economy that is expanding steadily at nearly seven per cent a year. The Chinese leadership is juggling rapid transformation in a country with a population of 1.4 billion — to put that in perspective, it’s 1,400 million people, compared to Canada’s 36 million.
They clearly did not warm to Trudeau’s hectoring on how to run their economy, something of which the prime minister was surely aware.
So why is he so insistent on a strategy that is not working? It all carries the whiff of domestic politics.
In an armchair discussion at the Fortune Global Forum Thursday, Trudeau talked about trying to find an “interface” between two different economic systems to mutual benefit. “Particularly with a country that is as significant … an economic powerhouse like China, we need to be reassured that the values, interests and jobs that Canadians hold dear fit in with that trade deal,” he said.
Of course, governments need to strike good deals that establish transparent rules and predictability. But it seems that what the prime minister is more concerned about is being able to win support from progressive voters who might not otherwise support trade deals.
The Chinese like Canada, but not because it is an open and accepting society. They respect familial ties, so appreciate this prime minister and the role his father played in gaining acceptance for the People’s Republic internationally in the 1970s. They remember Canada providing wheat credits at a time when China was recovering from the Great Leap Forward.
But we have let them down in the past too.
As Guy Saint-Jacques, Canada’s former ambassador in China, said last week, the Harper government backed away from full-blown free trade negotiations in 2012. “China is standing at the altar but won’t wait forever,” he said. “If we don’t negotiate now, after four rounds of exploratory talks, they will say ‘It’s déjà vu all over again.’ ”
It may be that the differences between the two countries and their contrasting systems can be resolved. But that will require one side to be more pliant.
It will take more than a dab of red paint between the eyes to turn the Chinese lion into a lamb.
IT ALL CARRIES THE WHIFF OF DOMESTIC POLITICS.