PWC on the Global Shale Oil Revolution
Further to a previous post on China’s shale gas prospects, PWC’s latest report Shale Oil: The Next Energy Revolution has something to say about implications for global geopolitics and major oil and gas producers such as Canada. So, Canadians should get off their high horse and get serious about building pipelines to export its crude.
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Thanks to such innovations as horizontal drilling and fracking (hydraulic fracturing), the U.S. is currently producing more oil than it has in 20 years. U.S. output now exceeds seven million barrels a day, and that has enabled the world’s biggest oil consuming nation to cut its imports to the lowest level in 16 years.
Since Canada’s crude oil exports are a critical driver of well-paid jobs, royalties, taxes — and ultimately, federal equalization transfers — that’s something that should alarm all Canadians.
Indeed, if current trends continue, the U.S. will overtake Saudi Arabia as the world’s top oil producer by 2017, the International Energy Agency has predicted.
As dramatic as that sounds, we may still be in the early innings of a worldwide shale oil revolution, says a new report by a team of energy analysts at PwC (PricewaterhouseCoopers) in London.
If it spreads, it could have huge implications not only for the North American oil industry and for Canada-U.S. trade, but for the entire global economy. Among the report’s key findings:
Global shale oil output could reach 14 million barrels a day by 2035, accounting for fully 12 per cent of the world’s total oil supplies. (By comparison, Saudi Arabia produces about nine million barrels of oil a day at present.)
The surge in shale oil supplies could lead to lower — not higher — global oil prices down the road. While the U.S. Energy Information Administration (EIA) expects oil to hit $133 US a barrel in real, inflation-adjusted terms by 2035, PwC says the price could be as low as $83 a barrel. That’s about $35 below the current price of Brent crude, the international grade.
Although lower oil prices would hurt major exporters like Russia, OPEC (the Organization of Petroleum Exporting Countries) and yes, Canada (which gets but a passing mention from PwC’s analysts), the net impact on the global economy would be very positive, the report says.
PwC estimates lower crude prices would boost global GDP (Gross Domestic Product) in 2035 by between 2.3 per cent and 3.7 per cent — or roughly $1.7 trillion to $2.7 trillion, in current terms.
The biggest beneficiaries would be major net oil importers such as India and Japan, which could get a GDP boost of up to seven per cent by 2035. The U.S., China, the Eurozone and the U.K. would also see GDP gains of up to five per cent, PwC says.
“The potential emergence of shale oil presents major strategic opportunities and challenges for the oil and gas industry and for governments worldwide,” the PwC report concludes. “It could also influence the dynamics of geopolitics as it increases energy independence for many countries and reduces the influence of OPEC.”
– Edmonton Journal
Canada’s History of Discrimination and Exclusion in Immigration
Refreshing article reminding Canadians of their less than dazzling record in welcoming immigrants of all races and ethnicities.
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Canada has a less than stellar record historically when it comes to immigration policy, having rejected or excluded Indians, Chinese, Jews and Blacks during various periods over the past century.
Today, the country no longer discriminates based on the colour of an applicant’s skin or religion.
But simply having an immigration policy discriminates or excludes certain people in one form or another, says Harold Troper, an immigration historian at the University of Toronto and co-author of None is Too Many: Canada and the Jews of Europe.
The government rejects certain occupations, requires certain language skills, and makes immigration officers available in only certain parts of the world.
Without notice, in 2012, it also arbitrarily rejected a backlog of nearly 100,000 applications, representing 280,000 people, many of whom had waited years to come to Canada.
Every nation’s immigration policy is written through an economic prism — it’s all about what’s good for the country economically, Troper says. That means someone will always be excluded or rejected.
These and other examples of discrimination paint a picture of a country — not unlike others around the world at the time — that was xenophobic and saw itself as an “Anglo-British outpost of British civility,” Troper says.
According to the Canadian Council for Refugees, specific measures taken by immigration officials included: an amendment to the Opium and Narcotic Drug Act to deport “domiciled aliens” with drug-related convictions (directed against the Chinese) in 1922; the prohibition of all Chinese immigrants in 1923; refusal of the ship the St. Louis, carrying 930 Jewish refugees, to land in 1939, forcing it to return to Europe — ultimately sentencing three-quarters of its passengers to death under the Nazi regime.
Perhaps the words of Canada’s Director of Immigration Branch F.C. Blair — held responsible for the policy of not allowing Jews into Canada — best exemplifies the tone and atmosphere of the Canadian government in March 1938. Blair is quoted on the CCR website saying: “Ever since the war, efforts have been made by groups and individuals to get refugees into Canada; but we have fought all along to protect ourselves against the admission of such stateless persons without passports, for the reason that coming out of the maelstrom of war, some of them are liable to go on the rocks and when they become public charges, we have to keep them for the balance of their lives.”
Only after the Second World War did the doors to Canada begin to open — a least a little. According to Troper, officials in Ottawa were reluctant. Immigration authorities had “cut their teeth on the racist, racially-tinged immigration stuff of the 1920s and 1930s,” he explains. And they were in many ways supported by the Canadian public. Troper cites a Gallup poll in 1945 that asked Canadians who they didn’t want allowed into Canada; their first choice was the Japanese, their second were Jews.
Despite these racist sentiments, there were cries for more labour from businesses to meet the needs of a postwar booming economy, forcing Canada to accept more immigrants.
After introduction of the 1952 Immigration Act, there was still room for discrimination. The act allowed for refusal of admission on grounds of nationality, ethnic group and geographical origin, and against homosexuals, drug addicts or drug traffickers.
Not until 1962 did the Minister of Citizenship and Immigration implement new guidelines removing most racial discrimination. In 1967, a points system was introduced and the last of racial discrimination was removed. Since then, the Immigration Act has been revamped and rewritten a number of times, including the most recent changes made by the Conservative Party last year.
– Toronto Star
Forbes Columnist: Why the US Did Not Prevent Crisis Over Diaoyus
Excellent commentary by Stephen Harner on America’s role in the escalating dispute over the Diaoyus.
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The Senkaku/Diaoyu island territorial dispute is the greatest crisis in Japan-China relations in 60 years.
Senkaku Islands (Photo credit: Wikipedia)
Second only to nuclear weapons development on North Korea and Iran, it is the most dangerous potential casus belli in the world today, and it likely to remain so indefinitely.
It is a crisis between and among the Japan, China, and—because of the U.S.-Japan security alliance—the United States, world’s three largest economies, possessing among them the world’s most formidable military arsenals.
The gravity and danger of the Japan-China Senkaku/Diaoyu territorial dispute are such that we would expect all parties concerned to have striven to prevent it escalating into a potentially hostile conflict
Why then, we must ask, did they not? More to the most critical point, why did the United States—which could have vetoed Japanese ‘nationalization’ of the islands, the action that guaranteed a full blown crisis—not do so?
Let me repeat: it was U.S. acquiescence in (if not encouragement of) the Noda government’s decision to nationalize the disputed islands—creating a direct and immediate challenge to China’s claim to sovereignty—that enabled this crisis.
If I may be a bit insensitive, aside from the tragic loss of life, against the enormity of the blunder in this case, the failures of U.S. policies and negligence in Benghazi, or even the naive wrong-footed dealing with the Arab Spring, are as superficial pinpricks against a gaping, life-sapping self-inflicted wound.
But, unlike toward Benghazi, there have been no congressional hearings on this egregious policy blunder. Rather, John Kerry, the erstwhile chairman of the U.S. Senate Foreign Relations Committee—where such hearings might have taken place—now occupies the office of U.S, Secretary of State, taking over from Hillary Clinton, who would bear the greatest culpability, ensuring—with the complicity of a Democratic Senate and ever-compliant pro-Obama foreign policy press–a continued cover-up.
There should be no doubt that the U.S. did in fact sanction Japan’s nationalization of the islands in September last year. In an interview with Asahi Shimbun published on October 31, 2012, the current Japanese ambassador to the U.S. Sasae Kenichiro states that before even approaching and seeking to mollify China, Japan solicited the position of the United States on nationalization and was told that the U.S. “did not oppose.”
We should expect that the “no opposition” policy message was delivered through diplomatic channels, i.e. through Hillary’s State Department, though the policy was almost certainly a product of the normal, often drawn-out and contentious inter-agency “clearing” process, in which—we must assume in this case—the input of the Department of Defense was heavily weighted. But DoD’s position should not have been—and I would guess was not—uncontested. And if it had been strongly contested by the State Department (i.e., in the official position adopted through State’s own internal “clearing” process), I doubt that the “no opposition” policy would have emerged.
The policy must have been violently controversial and contentious within State—pitting, at minimum, the “Chrysanthemum Club” on the Japan Desk against the heralds of the G2 world on the China Desk–for two reasons: 1. It was a sharp break with and effective change in long established U.S. policy toward the sovereignty of the islands; and, 2. There could have been no doubt about the furious reaction and sense of U.S. treachery and betrayal that the policy would engender in Beijing.
As to long-standing U.S. policy, from the end of WWII, and more explicitly from the return to Japan of sovereignty over Okinawa in 1971, the U.S. position had been unambiguous: while the U.S. “acknowledged” Japanese administrative control over the islands, the U.S. “takes no position on the ultimate sovereignty” of the islands. (Until recently the islands were referred to in U.S. diplomatic documents by both Senkaku and Diaoyu in a way that underlined that the U.S. was siding neither with Japanese nor Chinese—or Taiwanese—sovereign claims.)
After a hopeful start in U.S.-China relations, the pinnacle of which may have been the second U.S.-China Strategic and Economic Dialogue held in Beijing in May 2010. Then riding high, Secretary of State Clinton headed a U.S. delegation comprising over a dozen U.S. cabinet members and agency heads including Treasury Secretary Geithner, Fed Chairman Bernanke, Council of Economic Advisors Chairwoman Romer, USTR Kirk, and Commerce Secretary (now ambassador) Gary Locke. Jon Huntsman was then U.S. ambassador.
The relationship has seemed to cascade downhill from there, taking an increasingly militaristic, and confrontational tone, as the U.S. announced its defense structure “pivot” to Asia and WWII and Cold War legacy “alliances” emboldened the Philippines—and, indeed, Japan—to push back against or further press their own claims in territorial disputes with China, with Hillary in public fora often offering moral support.
Relations between nations, especially great nations, should be and usually are based on cool calculations of national interests, not on personal feelings or personalities. I cannot help but suspect, however, that China’s leaders’ refusal to be included among Hillary Clinton’s admirers served to harden and bias her attitude toward China in a way that redounded in favor of hard line nationalists in Tokyo.
How else to explain her acceptance—in approving Japan’s nationalization of the Senkaku/Diaoyu islands–of a clearly provocative and unnecessary change in U.S. policy that has served the interests of none of the parties, least of all perhaps the United States?
– Forbes
Qu Wanting is Vancouver Tourism Ambassador
Virtually unknown on the mainland, the Chinese singer-songwriter’s profile got a huge boost last Sunday with her appearance on CCTV’s Spring Festival Gala which was watched by more than 700 million people.
See video interview and photo gallery on:
China Investing in Infrastructure for the Future, US Not: Writer
A common observation of first-time Chinese visitors to America’s largest cities such as Chicago or New York is: “The roads and streets are so old and worn down. Feels like going to the Chinese countryside!”. Yep, many of America’s highways are over half a century old. Needless to say, the article writer’s comments on Amtrak point to severe dilemmas faced by US federal and state governments in transport and other infrastructure investment.
China’s high speed trains are more than twice as fast as the fastest Amtrak route (even sub-high speed trains are faster) and its HSR system will link most (all of) China’s largest cities by the end of the decade. The US will continue to be unable to repair its crumbling roads and railways without the Congress biting the bullet on entitlements at the expense of critically needed infrastructure spending. Otherwise, the writer’s son will indeed be riding trains ten times slower than China’s and earning much lower wages than his Chinese counterparts.
A recent Heritage Foundation Backgrounder on the consequences of US’s high debt, citing figures from the Congressional Budget Office’s (CBO) 2012 Long-Term Budgetary Outlook, states that US spending on entitlements and debt interest will remain at around 23-24% of GDP until 2018 as tax revenues linger at about 18%. This means annual budgetary shortfalls of 5-6%. America’s total public debt is already more than 100% of annual GDP and that’s not counting private debt.
And the picture gets even worse after 2018. From that year onward, the CBO estimates that spending on entitlements and interest etc. will steadily rise to near 36% of GDP by 2037 if drastic action is not taken! The consequences for the US, says the Heritage Foundation, are spiking interest rates, much higher inflation, and the crowding out of private investment, let alone what it portends for America’s infrastructure spending.
“US debt is quickly approaching economically damaging levels. US lawmakers should delay no more. Congress and the Presidernt should take firm and immediate steps to balance the budget within 10 years, by cutting spending and reforming the entitlements”, the foundation called out.
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A train ride between New York and Washington, muses Uwe Bott, epitomizes the deteriorating public transportation infrastructure in the United States. Sadly, there appears to be little hope for future improvement. That failure reflects a refusal of the United States to understand investments and returns, an understanding the Chinese already have.
For full article, see: http://www.theglobalist.com/StoryId.aspx?StoryId=9905
China’s Fracking Future
With crude oil prices hovering at just under US$100 a barrel juxtaposed to the steady decline in natural gas prices since 2011, it’s no wonder that the Chinese authorities have placed added importance on increasing the proportion of natural gas use in China’s energy mix to 10% by 2020.
One strategy is to import much more LNG from overseas suppliers through the building of a string of LNG terminals up and down China’s east and south coast. Currently, 5 terminals are up and running with another dozen being planned. But, by far the better strategy is to exploit the biggest technologically recoverable reserves of shale gas in the world. Interviewed last November, Chief of the US Energy Information Administration (EIA), Adam Siemenski remarked, “if the Chinese could do this, it would have enormous implications for them, and possibly for global LNG trade too”.
China’s Ministry of Land and Resources (MLR) conservatively estimates the country’s shale gas resources locked in six giant sedimentary basins across the country to be 24.8 trillion m3, slightly ahead of America but the EIA puts it at 35.7 trillion m3, or about 48% more than the US. The basins are: Songliao in the northeast, Ordos in Inner Mongolia, Bohai along the Bohai Sea, Sichuan to the southwest, and Tarim and Junggar in northwest Xinjiang Province. The Sichuan and Tarim basins are considered to be the most promising and early development has concentrated in the Sichuan Basin due in part to its location in densely populated Chongqing and parts of Sichuan Province.
BP’s latest Outlook 2030 study predicts that China is en route to becoming the most successful country outside of North America in developing shale gas by that date. But, industry analysts say that in the short and medium term, China is certain to fall short of its target of producing 6.5 billion m3 by the end of the 12th Five-Year Plan period (2015), making its target of 100 billion m3 by 2020 even harder to reach.
Even so, Qianye-1, Sinopec’s first exploratory well completed a year ago in partnership with Conoco and Chevron in Qianjiang District of Chongqing into Sichuan, yielded a significant amount of gas. PetroChina in association with Shell will also drill their own blocks in the region. Potentially, between 150 and 200 wells can be drilled in Chongqing over the next three years plus more in neighbouring Sichuan.
But, China’s shale gas ambitions face a number of obstacles above and below the ground. Hydraulic fracturing, the injection of water, sand and chemicals into the ground at high pressure to release trapped gas, requires vast amounts of water which is in short supply in many areas. This is particularly true of the Tarim Basin which is one of the most parched regions on earth and far away from centers of fuel consumption. Meanwhile, densely populated Sichuan/Chongqing face serious water shortages with China’s per capita water resources at only 28% of global averages.
In addition, China’s basins are still at the earliest stages of exploration and deposits are deep in the ground containing higher levels of kerogen and clay that make them less brittle for fracturing and keeping propped open. Interviewed by Yahoo’s Maktoob News, Chris Faulkner, founder and CEO of Breitling Oil and Gas, said typically, it takes 8 to 10 million gallons of water to drill a well in the US but because of its shale geology, it takes 10 to 13 million gallons in China. Water-intensive fracking would thus put a heavy burden on already-strained water supplies not to mention the possibility of contaminating clean drinking water for millions.
Not only are the Sichuan deposits deep at nearly 6 km but horizontal wells must be drilled to unlock commercially viable gas that would stretch drilling to 7 km or more. But, a Reuters report opined that none of the technical challenges are insurmountable and China has multitudes of engineers and its SOE oil and gas companies bundles of funds to throw at them.
The Sichuan Basin is already full of conventional gas fields and over 18,000 km of pipelines and its Qiongzhusi and Longmaxi shale gas formations actually lie on top of conventional ones, at depths similar to several shale fields in the US. According to the EIA, the two massive formations that have 200-300m thick organically rich layers, could each produce 9.52 to 9.8 trillion m3 of shale gas that together would be more than any other country save the US, Argentina and Russia.
China lacks certain technology, know-how and equipment for deep and horizontal fracking but its oil giants have spared no expense in North America to gain access to development expertise and state-of-the-art fracking and other drilling techniques and technologies. CNOOC’s successful takeover of Nexen is mainly about acquiring assets and also know-how which it hopes will help in lowering costs for wells that in China may cost up to US$30 million to develop compared to only $6 million in the US.
BC School Applies to Become First Canadian School to Offer TCM Degree
If the school is approved, it will be a boon for the traditional Chinese medicine (TCM) profession in BC.
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The PCU College of Holistic Medicine in Burnaby has applied to the province to become the first school in Canada with the ability to grant a university degree in traditional Chinese medicine.
The proposal to the degree quality assessment board, which the school expects to submit within weeks, has been in the works since 2006, said dean John Yang.
Yang has no idea whether his was the school Premier Christy Clark had in mind when she mentioned the creation of a school of traditional Chinese medicine at a B.C. post-secondary institution during her throne speech Tuesday. Now, only diplomas are available through private colleges.
An increase in acceptance and demand has made a university degree possible for the first time, Yang said.
When PCU College opened in 2002, there were 25 students. This year, the school has 200 full- and part-time students.
“There’s steady growth as more and more people are willing to study and get into this profession. Our school began with a very small class and now, it’s a reasonable size according to our population,” he said.
Yang believes it’s time for a university degree, such as a bachelor of traditional Chinese medicine with a major in acupuncture. Most students spend at least five years and many international students desire a degree comparable to ones available in China, Japan or Korea.
The education ministry said Wednesday no decisions have been made what institution would house the new school.
Kwantlen University has also started to incorporate alternative health practices such as acupuncture in its pending bachelor of science in health science program, but spokeswoman Joanne Saunders said the school has no plans to start granting degrees. The courses could be used as a springboard for entry into one of the province’s private colleges.
All B.C. students are required to have two years of university education as a prerequisite of admission, and colleges are governed by the regulatory body College of Traditional Chinese Medicine Practitioners and Acupuncturists of B.C., which also administers certification exams. To become a registered practitioner, a student needs 2,600 hours of study including 650 hours of clinical work.
In 1999, 68 registered acupuncturists were recognized and granted licenses by the regulatory body. In 2003, there were 872, and in 2008 there were 1,350, according to the college’s registrar Mary Watterson.
“The number of British Columbians seeking TCM (traditional Chinese medicine) treatment continues to grow. The profession, albeit a couple of thousand years old, is relatively new in Canada,” she wrote in an email, adding the industry has had an interest in expanding into university studies “for some time.”
Other health care professionals have also adopted acupuncture, making it more mainstream, said Poppi Sabhaney, president of the Traditional Chinese Medicine Association of B.C.
“A lot of other professions have used acupuncture as a kind of fishing hook that everyone seems to love, and that’s why there’s a renewed interest,“ he said. “Others have seen how effective acupuncturists and Chinese medicine practitioners are. They take our best techniques and incorporate it into their practices. … It’s growing rapidly, and we welcome it.”
For the entire article, see: http://www.vancouversun.com/School+applies+become+first+Canada+offer+traditional+Chinese+medicine+degree/7961658/story.html#ixzz2KpxAXkQC
China’s Food Security
There are many alarmists who warn of a global food crisis should China actively procure grains on the international market. Others accuse China of land grabs in Africa and other continents for food production at the expense of the locals. This article by Katherine Morton of the Australia National University sets the record straight.
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The policy debate on China and food security tends to be rather neo-Malthusian.
The overriding concern is that China’s population will demand more food than international markets can supply. Some commentators worry that competition over food may become a trigger for international conflicts — there are plenty of pessimistic forecasts predicting future food wars and clashes over scarce agricultural commodities. What these alarmist accounts fail to consider is that the Chinese want to be self-sufficient. That desire has led to a domestic policy of independence that acts as a safeguard against price volatility and means the burden of supplying the Chinese market does not fall heavily on international markets. But can China’s policy of self-reliance endure?
China has always been preoccupied with feeding its own population. For many Chinese, the real economic miracle achieved over the past three decades of ‘opening and reform’ is the fact that China has managed to feed roughly 21 per cent of the world’s population on only 9 per cent of the world’s arable land. The government has taken notice of volatility in food prices in recent years and it is determined to support domestic production. China’s political leadership is especially concerned about this issue because exposure to price volatility in international markets could lead to social unrest and political instability.
For the complete article, visit: http://www.businessspectator.com.au/bs.nsf/Article/China-food-security-farm-purchase-development-pd20130214-4VVMR?opendocument&src=rss
Climate Spectator: China’s Unsung Energy Intensity Reduction Efforts
I’ve posted on China’s ongoing and very successful campaign to reduce its energy intensity but here is a good synopsis.
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When I say that I’ve been working in China since 2009 and the organisations I work with have been there since 1999, many people seem to have an irrepressible urge to tell me what they think is happening in the Middle Kingdom. Because most of these informants have never actually been to China, much of what they tell me is plain wrong.
One area about which there is much misinformation is China’s performance on energy efficiency and consequently emissions mitigation. I’m often told that China is doing little about reducing its use of energy and consequently emissions are rising uncontrollably. As with most things about China, the actual situation is more complex.
True, China uses a huge amount of energy and both energy use and emissions are increasing rapidly. As the chart below shows, in 2009 energy use in China surpassed that of the United States.
Energy Use in China and the United States 2000 to 2009 (Mtoe)
Source: International Energy Agency
However, China has a lot more people than the US ‒ 1.35 billion compared with 315 million ‒ and China’s per capita energy use is well below the world average, though it has been increasing sharply since 2001, as shown in the following chart.
Primary Energy Use Per Capita 1960 to 2007 (kgoe/capita)
Source: World Bank World Development Indicators
The most interesting story concerns what’s been happening with China’s energy intensity (energy use per unit of GDP). As shown in the following chart, energy intensity has been decreasing steadily since 1980, except for a short-term blip between 2002 and 2004. Though not shown on the chart, the decrease actually started in 1976.
Energy Intensity in China 1980 to 2009 (Btu/GDP in 2005 $US)
Source: US Energy Information Administration
The following chart shows that energy intensity in China is still higher than in the US but China is trending downwards, whereas the US is pretty static.
Energy Intensity in China and the United States 2005 to 2010 (Btu/$GDP)
Source: Climate Policy Institute/Tsinghua University
The major cause of the long-term and quite steep decline in energy intensity is the extensive, government-driven energy efficiency programs that have been implemented in China, about which little is known in the west.
In part two and three of this series I will expand on the nature of the energy efficiency policies and programs that have been implemented.
David Crossley is a senior advisor with the Regulatory Assistance Project. The Regulatory Assistance Project is a global, non-profit team of experts focused on the long-term economic and environmental sustainability of the power and natural gas sectors, providing assistance to government officials on a broad range of energy and environmental issues.
– Business Spectator
CCC Chief: Canada Playing “Catch-up” in China
During the first Harper government, much petty ideological rhetoric was hurled at China, squandering many Canadian advantages and the efforts of the previous Liberal government. Harper et al. has since made a dramatic turn around but Canadians are still fickle, putting a drag on deepening relations. Here is some frank talk from the president of the Canadian Chamber of Commerce.
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Prime Minister Stephen Harper is now trying to make up for lost time when it comes to Canada’s ties with China, and there is a lot of work to do to brand Canada as a serious player in the international market, according to the head of the country’s biggest business association.
Perrin Beatty, president and chief executive officer of the Canadian Chamber of Commerce said in an interview last week in Hong Kong that both the federal government and the business community have ignored China’s booming economic growth for too long.
“During the first part of the current government’s term in office I’m not sure they fully understood how much Canada’s strategic interests were international — that our success in Lethbridge would depend on how we’re doing in Hong Kong,” said Beatty. “They’ve learned.”
Beatty said the Harper government is now more focused on diversifying trade beyond the United States and that there has been a “real maturation” in the government’s view on Canada’s relationship with China, but that “we’re playing catch up.”
“The rest of the world is here [in China], they’re branding themselves and doing so effectively,” said Beatty, a former Progressive Conservative member of Parliament and cabinet minister. He was in Hong Kong to meet with local and Canadian people from government and other sectors.
He said Canada used to have a privileged position in China but it was lost partly because successive federal governments did not give it the attention it deserved, and partly because the business community was too focused on the “seductive” American market right next door.
Canadian businesses have to grow internationally and better branding will be key to that success, said Beatty. He said he consistently hears from international contacts that Canada is known for its stunning landscapes and friendly people — not business. That has to change, said Beatty.
“We need to brand Canada as a high-technology, well-educated, dynamic country with a lot to offer in the global marketplace. We haven’t done that,” he said.
Confusion surrounds Canada’s multiple levels of government, each with different responsibilities and ways of doing things, said Beatty, and that can ward off potential foreign trade and business deals. The federal government should take more leadership in presenting Canada as a cohesive country, he said.
Canada’s diplomats and trade commissioners do what they can with the resources they have, said Beatty, and they should get more support to help push Canada ahead.
Canada has 11 offices in China, including the embassy in Beijing, that offer support to Canadian businesses trying to break into the complicated Chinese market. Business associations, such as the Canadian Chamber of Commerce in Hong Kong, are also promoting greater business ties.
Harper has started taking visible steps to strengthen Canada’s relationship with China. He took his second trip there in February 2012 and signed a number of agreements. In September, the controversial Canada-China Foreign Investment Promotion and Protection Agreement was signed.
Canada is much more engaged in China now but is still under pressure and has to “step it up,” said Beatty. He acknowledges that’s easier said than done, however, given China’s complexity and the competition Canada faces. Beatty also acknowledges that reports in the media about intellectual property theft and computer hacking don’t help to strengthen the relationship and that the human rights concerns in some Chinese factories are “very real.”
But foreign companies can help raise working standards and have a positive effect on how China does business, he said, adding that cutting off China because of how it conducts itself would be a “terrible mistake.”
“You don’t isolate China, you isolate yourself. This is an economy that is going to be the number one economy in the world, it is the largest country in the world today by population and its influence in every sphere is increasing dramatically,” he said. “You want to be engaged with somebody like that, you don’t want to assume that they’re going to be begging to do business with you if you don’t make the effort yourself.”
– CBC