05/02/2012 02:39 EDT | Updated 07/02/2012 05:12 EDT

Made in China? More like Destroyed by China

Not only should China be banned from construction or bidding, but Investment Canada should ban Chinese companies from buying resource companies, or related assets. They low-ball to get contracts, then use shoddy materials, and have no respect for the rule of the law in Canada.

Ann Woo

All Chinese companies must be banned from construction work in Canada because of their questionable track record here and around the world.

It was shocking that Enbridge Inc.'s Pat Daniel said his company was willing to allow a Chinese company to buy a piece of, and to bid for the construction, of the proposed Northern Gateway oil sands line.

Not only should China be banned from construction or bidding, but Investment Canada should ban Chinese companies from buying resource companies, or related assets.

China's strategy around the world is to buy resources, then low-ball to get construction contracts by using Chinese labourers and materials. This is not only damaging to the domestic economy, and unnecessary, but in some cases laws and obligations have been flouted, and people and host governments damaged.

In 2007, Sinopec Shanghai Engineering Company brought in 132 Chinese workers to an oil sands site to assemble their storage tanks, and do other work. Two workers were killed and several others injured. The remaining Chinese workforce was moved immediately out of Alberta, and work stopped.

The Alberta government charged Sinopec, its subsidiary, and their oil sands client with 53 safety charges. Sinopec and its branch plant have refused to appear in court. They say they have not been served papers because they are in China where they cannot be served papers to appear in court. Instead of acceding to Canadian law, they have not appeared.

In November, an Alberta Court of Appeal ruled the company must stand trial on these serious charges. In February, Sinopec said it wants the Supreme Court of Canada to overturn this ruling because it should be exempt.

It gets worse. Sinopec also did not pay these workers. The 132 Chinese workers were not paid an estimated $3.17 million by their Chinese employer even though they worked four months before the accident. They were transported out immediately after the deaths. Alberta employment standards spokesman Barrie Harrison said that the prime contractor, the Canadian oil sands project client, put the $3.17 million in wages, and benefits in trust even though it had no obligation to do so.

In an interview last year, Harrison said: "We are still trying to determine the best, most secure method of returning these funds to the workers, who are now either back in China, or working at other sites around the world. We've had nothing new to report on this file for quite sometime."

The Canadian embassy in Beijing has been involved in trying to right this wrong, at taxpayer expense.

This outrageous behavior by China and its companies should be reason enough to ban Chinese construction bidding, or workforces in Canada. After all, a major corporation has no respect for the rule of law here. It has damaged Chinese workers, and its Canadian client. It has cost the taxpayers of Alberta a great deal of money to try and clean up the mess, and prosecute those involved in the wrongdoing; it has cost the taxpayers of Canada, Canada's immigration department, and Canada's justice system as well.

By the way, this deplorable behaviour is nothing new or unique to Canada.

Shoddy work, and broken promises have occurred elsewhere. In Angola, in July 2010, more than 150 patients had to be evacuated from a new Chinese-built hospital in Luanda, after its walls began cracking, and bricks began disintegrating. China Overseas Engineering Group Co. (COVEC) built the hospital for $8 million. Reports began to come out in the local media that many roads, schools, hospitals, and other infrastructures completed by the Chinese were sub-standard or unsafe, and promises to employ Angolans were not kept.

Another example, in a developed nation, occurred in 2010. The Chinese were finally able to penetrate the European Union when COVEC won a bid to build a major highway in Poland by bidding less than half the price of domestic contractors. This caused consternation across the EU because of Chinese tactics around the world. The pattern is well worn: Chinese firms low ball to beat out local competition unfairly then bring in substandard materials, and workers from China.

The Poles, committed to tender bidding for contracts, were stuck with accepting COVEC's basement bid but were wise to their tactics. They stipulated that the company could not import Chinese materials, supplies or labor.

But COVEC flouted this requirement and started to bring in Chinese workers anyway, claiming that Polish workers were not cooperative and would not take pay cuts.

Then they began sourcing supplies from China, claiming that Polish suppliers refused to match Chinese prices.

In June 2011, COVEC stopped work. Poland sued COVEC for $271 million in damages for breach of contract. And the country has had to spend huge amounts to complete the highway in time for the 2012 European Football Champions in Poland this summer. COVEC told China Daily that it was asking for compensation.

For these reasons and more, Canada must ban any bidding or work permits to Chinese workforces. They simply are not acceptable. They are also not the only buyers for oil sands production either. A pipeline can deliver oil to the west coast to Asian and South American markets.