Canada China Track Two Talks

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More than a year later, Canada-China ‘track two’ talks yet to begin

Trade dialogue, promised after Harper visit in November 2014, has yet to materialize.

Chinese Embassy Photo
Chinese Ambassador Luo Zhaohui meets Foreign Minister Stéphane Dion.

Peter Mazereeuw
Published: Wednesday, 01/13/2016 12:00 am EST

The government of Canada has yet to act on a 2014 promise to establish a panel of business and non-government groups to hold talks with Chinese counterparts on closer trade, according to Global Affairs Canada.

With the election behind it, the new Liberal government should move ahead with the so-called “track two” talks to help it prepare to negotiate with China for some form of closer trade, said a former Canadian diplomat and the head of the Canada China Business Council.

Progress on establishing the talks had been “quite slow,” Chinese Ambassador Luo Zhaohui told Embassy in November 2015. The embassy affirmed its support for advancing the dialogue in a Jan. 8 emailed statement.

Non-government talks promised to address trade, maritime energy

Canada’s government announced it would establish a joint panel with China, including representatives of the business community, after former prime minister Stephen Harper met with Chinese Premier Li Keqiang in Beijing in November 2014. The panel would “actively explore the way to deepen bilateral cooperation in areas such as trade and economic relations.”

The two sides also agreed to establish a “track two dialogue to study new approaches to enhance energy trade, including potentially an environmentally safe maritime energy corridor,” according to a November 2014 government press release.

“Track two” talks are typically initiated by governments but conducted between business, academic or other non-government groups.

However, the track two dialogue on trade “has not been established,” Global Affairs Canada spokesperson Diana Khaddaj wrote in an emailed statement, adding the government was “considering next steps.”

Natural Resources Canada did not respond by deadline Tuesday when asked whether the study on a maritime energy corridor had been begun.

The former Conservative government shied away from an offer by China to engage in free trade talks, but did negotiate what would become a controversial foreign investment agreement.

The new Liberal government has signalled a more open approach to trade talks with China, tasking Trade Minister Chrystia Freeland to focus on expanding trade with the country as part of her official mandate.

China still hoping to launch FTA negotiations: Embassy

China still supports track two talks on free trade, and hopes to launch free trade negotiations soon, according to an emailed statement from Yang Yundong, a spokesperson for the Chinese embassy in Canada.

“Strengthening the China-Canada Track II Dialogue to explore and identify new areas and ways of deeper China-Canada bilateral trade and economic co-operation is a consensus between leaders of our two countries,” wrote Mr. Yang.

“Given the sound momentum in China-Canada relations, we hope the two sides will build on the opportunity to launch the process of FTA negotiations at an earlier date,” wrote Mr. Yang.

Dion meets with Chinese ambassador

Mr. Luo and staff at the Chinese Embassy met with Foreign Minister Stéphane Dion on Jan. 7 to discuss relations between the two countries, according to a post on the Chinese Embassy website.

Mr. Dion’s chief of staff, Julian Ovens, and policy advisor, Pascale Massot, also attended the meeting, as did Graham Shantz, director general of Global Affairs Canada’s trade and diplomacy for North Asia division, the post says.

The Liberal government may choose to rebrand the track two talks under a new name as part of its effort to reinvigorate Canada-China relations and put its own stamp on foreign policy, said Sarah Kutulakos, executive director of the Canada China Business Council, and Colin Robertson, a vice president of the Canadian Global Affairs Institute and former Canadian diplomat.

China’s government has established similar discussions with other countries as well, said Ms. Kutulakos.

“It’s actually a quite useful way to leverage the capabilities of many of their former officials who have reached retirement age, and then often go to work for think tanks,” she said.

Canada’s government should establish a track two panel as part of its preparations to negotiate closer trade ties with China, said Mr. Robertson. 

Canada has options besides full-fledged free trade negotiations, said Ms. Kutulakos. While those deals can take years to negotiate—about 10 years in the case of the China-Australia deal—smaller agreements can help to boost trade over the shorter term. The agreement to facilitate the export of British Columbia blueberries to China, announced in June, is one example of how that can work, she said.

The CCBC is set to release a report on the prospects of Canada-China free trade. The study was put together with the Canadian Council of Chief Executives and the Wilson Center.