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Pay Attention to Asia, Eh!

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The election of a majority government has set the stage for Stephen Harper to put his stamp on a Conservative approach to international issues.

In the previous minority administration, Mr. Harper did not place much attention on foreign policy. To the extent that he did, it was largely because he inherited the file (Afghanistan), was obliged to host a meeting (the G8/G20 Summit), or sought to distinguish his approach from previous Liberal policy (China).

His ministers were stymied in attending important international meetings because of the need to be close to Ottawa, and officials spent much of the last five years second-guessing their political masters or simply coping with sharp budget cuts.

While it is unlikely that the new government will launch a Canadian foreign policy renaissance, there is good reason to expect a stepped-up approach to international issues, and perhaps even a breakthrough in key areas that have held back Canada's effectiveness as a global player.

The first reason for optimism is the new Minister of Foreign Affairs, and his counterpart at International Trade. John Baird is an influential player who has the ear of the PM. While his views on international issues are not well known, Mr Baird has a reputation for getting things done, and -- whatever the foreign policy agenda -- it is likely that he will bring the same degree of effectiveness to his new job.

Trade Minister Edward Fast is a newcomer to cabinet but is also widely known for his work ethic and focus. More importantly, his B.C. base and concurrent responsibility for the Asia Pacific Gateway could drive a more strategic approach to relations with Asia -- arguably the single biggest priority in Canadian foreign policy next to U.S. relations.

The strongest reason for optimism, however, is the old saying about the intersection of international and domestic policy. Increasingly, the case for a more robust policy on Asia can be argued on domestic grounds, rather than on arcane points of international diplomacy.

Asia matters to Canada more than ever, and the impact of Asia's rise is being felt in many industries and communities across the country. The forest products industry in B.C. is an excellent example, where exports to China have effectively saved the industry. The collapse of the U.S. housing market in the last three years -- with more gloom in the foreseeable future -- threatened to decimate the industry and put thousands of Canadians out of work.

Chinese demand for B.C. wood appeared at just the right time -- the result of many years' investment in marketing and promotions -- to compensate for the downturn in North America. Softwood exports to China are running at more than five billion board feet annually, and are on track to surpass exports to the U.S. in two years. Over a dozen mills in B.C. are operating today only because of Chinese demand -- and mill workers and their families know it.

The wood products story is starting to play out in other industries which have been forced to look to emerging markets, especially in Asia, to make up for depressed U.S. demand. In a study of Canadian companies in China conducted by the Asia Pacific Foundation of Canada, 20 per cent of respondents reported that more than half of their revenues came from China operations. For a growing number of firms, the importance of China has crossed the tipping point that turns the Chinese market into a corporate priority, with the commensurate high-level focus and resources that it deserves.

The need to pay attention to Asia, therefore, is becoming an essential part of mainstream business strategy. Furthermore, business and community leaders understand that the Government of Canada has to provide leadership on Asia policy. The Foundation's recent survey of Canadians with professional interests in Asia found overwhelming support for an Asia strategy. They are convinced that a global power shift towards Asia is happening, and see engagement with Asia as a way for Canada to insert itself in the power shift that will likely affect global affairs over the next century.

Furthermore, they believe an Asia strategy should be at the centre of Canadian policy rather than treated as a niche activity in a few line departments. When asked if an Asia strategy would make a difference in their work, 80 per cent agreed.

The prime minister has also hinted at the importance of Asia in his set of priorities for the next four years. When asked what a majority government meant for the country, Mr Harper said Western Canada in particular would benefit because his government will be able to deliver on issues related to energy, transportation, and infrastructure. He did not go into specifics or mention Asia, but it is well known that some of the most pressing questions in these three areas have to do with Canada's transpacific ties: pipelines, tanker traffic, port and rail capacity, inward investment, and air services, to name a few. While these issues are not part of foreign policy as such, they constitute essential elements in an Asia strategy for Canada.

There is nothing inevitable, however, about Ottawa's leadership in the development of an Asia strategy, even if the international and domestic conditions for such are more compelling than they have ever been. The risk is that the decades-old pattern of piecemeal action (or inaction) on trade and investment, or on infrastructure and energy policy, and the continuation of a transactional approach to relations with Asia, will pass for a more strategic vision of Canada's place in the Asia Pacific region. Hence, the opportunity for the Conservatives to chart a new course in Canadian international policy, and to define Canada more firmly as an Asia Pacific country.

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