Harper's 'strategic partner' China yields investment deal

Prime Minister Stephen Harper and Chinese Premier Wen Jiabao presided over a signing ceremony Wednesday for a wide-ranging set of agreements set to further bind the Chinese and Canadian economies.

One concluded negotiations for a groundbreaking investment deal. Others announced "partnerships," "frameworks," "calls for proposals" or more conventional trade deals in a range of sectors from energy to education.

The CBC's chief political correspondent Terry Milewski called them a "small blizzard of incremental agreements." Individually, some may not seem very significant, but taken together they will have a significant effect on Canada's relationship with an economy that may soon be the world's largest.

During their bilateral meeting, Wen spoke of Harper's first visit to China in 2009 as having "opened up a new page in our financial relationship" and suggested this week's meetings could "further enhance our mutual understanding and trust so that we can elevate China-Canada relationship to a higher level."

Harper noted in reply that "Canada-China exports and trade have almost doubled since we took office."

Harper repeated a signal delivered in recent weeks to Canada's U.S. trading partner, saying "diversifying our markets is a key priority for Canada" and listing energy and natural resources at the top of his list of priorities for the partnership.

Harper touts results from 'strategic partnership'

Speaking to reporters after the bilateral talks, Harper said "Canada has reached a number of extremely important milestones in the development of our strategic partnership with China," noting that his government had achieved things previous governments had sought but failed to achieve.

He also acknowledged that his government's relationship with China has evolved.

"There was a view when we took office that you either had to deal with the Chinese on economics or to deal with them on human rights and consular matters, but you couldn't do both," Harper said.

"We refused to accept that view. We thought that was a view that was driven frankly out of a weak approach to foreign policy," he added.

Harper addressed directly his critics who have suggested recent economic gains with China have come at the expense of Canada's reputation as a strong advocate for human rights.

"It is possible and necessary to raise with the Chinese a full range of issues as part of a frank and productive relationship and I think the Chinese are themselves increasingly comfortable with that and increasingly comfortable with this government's style," Harper told reporters.

'Comprehensive economic agreement'

Canada and China have concluded 18 years of negotiations on an investment protection deal for investors in both countries. 

A declaration of intent was signed Wednesday for a foreign investment promotion and protection agreement (FIPA) between the two countries.  

The deal still needs to be legally reviewed and ratified by the Canadian and Chinese governments before it can come into force. In Canada, that will include debate in the House of Commons. But the deal is essentially done, the CBC's Susan Lunn reported from Beijing.

Harper called the deal Canada's first "comprehensive economic agreement" with China.

The agreement gives foreign investors equal footing with domestic businesses in either country. Business groups had been urging Harper to wrap up talks with China in order to spur greater investment between the two countries.

Canada and China had been negotiating the agreement since 1994, and by January 2010, a dozen rounds of talks had failed to produce a deal.

By the end of 2010, Canadian investment in China increased by 38 per cent over 2009 levels. That same year, Chinese investment in Canada totalled $14 billion, an increase of nine per cent.

The FIPA has been desperately needed, given Canadian investors' experience with corruption and fraud in China, the CBC's Terry Milewski reported from Beijing.

Officials now expect it will be reviewed and ratified by both sides within a year, he said.