Canada’s opportunities at November leaders’ summits in Asia
In November, Canada’s Prime Minister will travel to Asia for two leaders’ summits. On November 10-11 China hosts the Asia Pacific Economic Cooperation (APEC) forum’s twenty one leaders. Four days later, on November 15-16, the focus broadens to economics and security at the G20 leaders’ summit in Australia.
Each summit host is focusing laser-like on improving the prospects for global growth. The Asia-Pacific region is currently the main source of growth as recovery elsewhere from the global financial crisis continues to lag. Adding to the slow pace is China’s economic shift from a high-growth, investment-driven strategy to one that pays more attention growing middle class incomes and consumption. Economic restructuring to encourage productivity and innovation is essential for this shift. But it produces both winners and losers. In the emerging market economies, smarter regulation, better access for small firms to finance, investor protection and contract enforcement are strategic issues. More advanced economies are focused on employment prospects for the young, more long-term investment, lower barriers to trade and facilitating global value chains.
What will Canada bring to these tables? Writing them off as talk shops overlooks two realities: this year’s hosts are serious about actionable strategies; and each meeting affords opportunities to deepen bilateral relations through meetings between leaders on the margins. As Canada did at the 2011 APEC summit in Honolulu by belatedly joining the Trans-Pacific Partnership negotiations.
At the Australian Summit Mr. Harper has a close relationship with host Prime Minister Tony Abbot. Although the relationship with Chinese President Xi Jinping is more formal a Beijing bilateral offers a unique opportunity. The strategic agendas of both summits fit well with ongoing discussions between Chinese and Canadian governments to facilitate trade, investment and other financial flows, and deepen mutual understanding. The two leaders should agree to: (1) implement the long-delayed Foreign Investment Protection and Promotion Agreement (FIPA); (2) clarify Ottawa’s opaque foreign investment screening policies; (3) reinvigorate the 2012 officials-level Complementary Study as a channel to deepen understanding of each country’s institutions and expectations of the other; and (4) sign off on a bilateral currency swap between their central banks to facilitate direct use of the Renminbi in bilateral trade, investment and other financial transactions (something the province of BC has already done in its own bond financing).
Such a package is overdue in changing expectations and setting the economic relationship on an upward trajectory.