Close Encounters

How best to deal with a rising China.

In this election season, as most others, foreign affairs rest at the periphery of party platforms and public discussion. The Conservatives’ reactive focus on supporting Israel, fighting ISIL, ducking global warming, and confronting Vladimir Putin over Crimea and Ukraine will generate some debate. And there is always the possibility of the unexpected. But on the bigger strategic dimensions of Canada’s role in the world we can expect little. After a decade of steadfast refusal to articulate a comprehensive foreign policy strategy—remember that the Conservatives’ 2005 Red Book had 171 words on foreign affairs—it is very unlikely that one will emerge before October 19. And there is no sign that opposition parties have well-developed alternatives, however different their instincts might be.

The timing of the release of David Mulroney’s important Middle Power, Middle Kingdom: What Canadians Need to Know About China in the 21st Century thus represents a missed opportunity. China is constantly in the public eye, attracting more attention in mainstream and social media than any country other than the United States. It is on the minds of Canadians who understand that the global power balance is shifting. Polling by the Asia Pacific Foundation of Canada reveals that more than two thirds of Canadians believe that within a decade China will be a more powerful country than the United States. And there are anecdotes galore about how individual Canadians are reacting to what many see as a China on their doorsteps and changing their ways of life. The decisions of the Chinese government, business leaders and consumers have impacts virtually everywhere.

Media interest in the book so far has focused mainly on Mulroney’s searing assessment of the Harper government’s management of China relations. Although unlikely to have any effect on voter preferences, Mulroney’s views are important for other reasons. Part memoir, part foreign policy treatise, and written in sincere and accessible prose, the book offers insightful recommendations on how to manage the China relationship and the deeper political and moral question of what we want that relationship to achieve. Curiously, while highly critical of the Harper government’s tactics, Mulroney is closely aligned with the world view and objectives that lie beneath them. The China challenge will not go away regardless of October’s outcome.

Thirty years a diplomat, almost all of that time focused on Asia, Mulroney served as head of the Canadian Trade Office in Taipei, a secondment to direct the Canada-China Business Council, the senior position coordinating Ottawa’s management of operations in Afghanistan, and then as ambassador to China from 2009 to 2012. This is an insider’s account—at least as “inside” as any diplomat can be in the Harper era. While some other Canadian ambassadors to China have written about their China experiences and Canada-China relations, among them Earl Drake and Howard Balloch, none has written so trenchantly, so profoundly discouraged or so soon after leaving government.

The critique of the Harper government’s China policy reinforces what several other commentators have said, but adds the authority of someone on its front line. Mulroney chastises the government for lack of coordination, the primacy of political considerations and partisanship, the penchant for pandering to important domestic political constituencies, the triumph of photo ops over substance. As Chinese, Indian and other leaders focus on big issues, Canadian leaders play games for domestic audiences and are less curious about the world than about themselves. They have “infantilized” foreign policy by thinking we should form relationships with countries because we like them. They have lost the ability to listen, establish trust and make compromises. They have concentrated far too much on empty rhetoric rather than achieving results and focused too heavily on trade to the detriment of other Canadian interests.

Not surprisingly, Mulroney is particularly concerned about how professional diplomats have been dealt out of policy formulation or even being asked for serious advice by their political masters and their staffs. At the same time they are being held publicly responsible for mistakes that are the government’s doing. Not only has the government failed to produce a coherent and comprehensive China policy, but it has also eliminated the space for strategic thinking.

Operationally, he recounts several successes during his time as ambassador when he attempted to bring “energy and ambition to the bilateral agenda.” In what he described elsewhere as the golden years of the relationship after Harper’s first visit to China in 2009, including President Hu Jintao’s return visit in 2010 and Harper’s return in 2011, momentum was building and the scaffolding was constructed for a bigger relationship. Beijing and Ottawa completed a complementarities study, often the precursor to a free trade agreement negotiation, signed the Foreign Investment Promotion and Protection Agreement after a decade of negotiations and began implementation of a tourism agreement. They also prepared the ground for a surge of Chinese investment in Canada, with much of the Chinese interest focused on the energy sector. The loan of the pandas was assured.

Although the agenda could be considered small ball by the standards of what other countries were putting in place during that period, it marked a significant reversal of the “cool politics, warm economics” approach that the Conservatives pursued in their first three years in power.

In 2012, the momentum was broken, as symbolized by Ottawa’s decision to approve the sale of Nexen to a Chinese state-owned enterprise but at the same time to put in place guidelines to limit future investments. The Chinese were confused by the mixed signals they received and angry at the decision. Cabinet delayed ratification of the FIPA for almost two years. Chinese investment in Canada plummeted. Rather than dodging a bullet, Mulroney concludes, Canada had shot itself in the foot. Whether or not the decision was the right one, Ottawa had shown cold feet and sent mixed signals. It went silent when confronted with controversial and difficult decisions.

Subsequent to Mulroney’s departure, the FIPA was approved and Canada has taken further small steps including approval of a renminbi currency hub in Toronto. But allegations in 2014 about Chinese cyber hacking and the arrest of two Canadian missionaries in China dominated headlines. Cabinet has still been unable to approve a China strategy document and shown only intermittent interest in the China file.

Mulroney is a booster of economic and people-to-people relations on multiple fronts, yet his are not the views of a naive panda hugger. “Engaging China intelligently means facing up to a country that is not only unlike us, but one that sometimes acts in ways that can run counter to our own values and interests,” he notes. Engagement, Mulroney-style, frames China as both a threat and an opportunity, with an emphasis on how to manage the risks. He sharply criticizes China’s human rights policy, chronicles the difficulties of navigating the Chinese system, is angered by its cyber attacks and efforts to interfere in Canada’s domestic politics, and is worried about Chinese assertiveness and aggressiveness in completing what he describes as its “unfinished empire.”

With regard to public interactions with China, it is clear that their frequency and intensity are expanding dramatically and that the public mood is increasingly ambivalent. Some of Mulroney’s most valuable chapters outline these interaction points ranging from student exchanges to business transactions, and both the challenges and opportunities they present. Informed, realistic and constructive, he provides a virtual handbook of how to navigate complicated issues: how to get more Canadian students to China—maximize the career rewards for doing so; how to handle concerns about Chinese purchases of residential real estate—work with China to restrict illegal flows of money; how to push human rights in China—be patient, be imaginative, commit resources, have local allies; how to expand tourism—provide the right breakfasts. And while chronicling the ills of a variety of domestic practices and international activities, including interference in Canada’s domestic affairs, and of a Chinese government he does not admire or deeply trust, he outlines ways to expand cooperation on the environment, climate change, product safety and endangered species and on how to understand and work with Chinese SOEs.

Less persuasive is Mulroney’s account of how to understand and deal with China’s security aspirations, a China that he describes as tone deaf to the concerns of people on its periphery, aggressive with its neighbours (especially in the South China Sea) and rapidly expanding its military assets. He prescribes backing the maintenance of U.S. influence in the region while welcoming China into peaceful roles, building up our navy and increasing the exposure of our top military officers to China. He sees a rising but insecure China, not Russia, “as the greatest challenge to global security over the long term.”

Although gently framed, this amounts to a prescription for countering or the soft containment of China very different than the middle power role enshrined in the title of the book. Our biggest asset in responding to the rise of Chinese power is working with like-minded countries in strengthening multilateral institutions that can assist Asia in adjusting to a shifting balance of power in which China is a dominant actor. The real challenge is the U.S.-China equation and the search for a regional order that can forestall their collision and Cold War 2.0 or worse.

Canadian thinking about engagement with China traditionally has been built on three foundations: the pursuit of commercial advantage, the shaping of Chinese behaviour by including it in the international community, and a compact with the public that we should try to change China’s fundamental political, social and economic institutions or at least influence its behaviour. In its passive form, this compact is based on the assumption that with economic and social openness and integration into the world community, political liberalization is bound to follow. In its active form it is the view that we should attempt to intervene directly in Chinese internal affairs to promote the changes we wish to see.

Scratch the Canadian skin and there is often a missionary impulse just beneath the surface. From the 1870s to the 1950s, no country on a per capita basis was more active than Canada in sending Christian missionaries to China. In the 21st century, the missionary spirit is usually of a more secular nature and most often focused on promoting human rights and democracy.

Mulroney’s book is unusually valuable because it opens up the matter of exactly what are the Canadian values that we wish to promote in our relations with China and what we expect of ourselves and the Chinese. He makes explicit his own Catholic faith. This faith did not affect his eminently secular approach to managing the issues in the bilateral relationship, which he pursued with consummate professionalism. But it does shape the China narrative that he presents. While he deeply disapproves of the Conservative government’s tactics and strategy in dealing with China, he shares some of its core objectives.

Like many Canadians he is committed to a universal conception of rights, in his case underpinned by a natural right tradition of thought. He is not so crude as to reduce this to one-dimensional anti-communism or the Conservatives’ mantra of “freedom, democracy, human rights and the rule of law.” China does not need to emulate our Charter of Rights and Freedoms. Rather, “we should instead support efforts to realize the basic rights outlined in the Universal Declaration in ways that align with Chinese traditions, society and culture.”

But Mulroney does believe that human rights are universal and inalienable and that it is our obligation not just to hope for China to embrace them but to positively promote them. He takes aim at those who offer cultural and historical arguments about why democracy is not right for China or those who view rights as a nation’s concern or merely western.

In looking for a model of leadership in advancing the Canada-China relationship, Mulroney puts Pierre Trudeau at the top of his list for subtlety of mind and decisiveness of action. The irony is that Trudeau’s Jesuit-inflected Catholicism made him much more sympathetic to cultural and civilizational differences. Disparaged by conservative critics as a cultural relativist, Trudeau saw no contradiction in championing the Charter of Rights and Freedoms in Canada while opening relations in 1970 with a communist government in the midst of a turbulent cultural revolution. Trudeau did so with the assumption that opening China to the world might encourage positive change in China’s external relations but without assuming that China soon or ever would converge with western conceptions of social order or good government.

In his post-diplomatic career as the president of St. Michael’s College at the University of Toronto, Mulroney has the opportunity of being a leader in educational exchange and enriching the China debate from a values perspective. Should our aim be to change China or live with it? How conditional should engagement be? How can we build respect and trust and pursue our multiple interests with a country whose political regime many find to be illegitimate?

Whatever government is in place after the October election faces a huge task in designing and articulating a comprehensive China strategy and rebuilding public support for a deep relationship with a country outside the comfort zone of many Canadians. The leadership would benefit from paying close attention to the arguments made in Middle Power, Middle Kingdom, not necessarily because all will agree with Mulroney’s analysis, but because he provides a mature starting point for debate.

It is useful to recall that missionaries of the past debated similar matters actively a hundred years ago. This time the answers will be more difficult and important because we are not dealing with a weak China at the mercy of western powers, but a powerful international player on our doorstep, which under Xi Jinping will be more assertive and globally engaged than ever before. In our dealings with this emergent superpower, it is well past time for Canadians of all political stripes to think quickly and clearly about where we wish to stand and the strategic choices we need to make.