Investment deal could make Canada a Chinese resource colony

(The Canadian Press) OTTAWA - An investment treaty with China that would turn Canada into a "resource colony" is about to be ratified despite almost no parliamentary debate, opposition critics charge.

Bolstered by more than 60,000 signatures on petitions and a finely targeted letter-writing campaign led by activists, the opposition NDP, Liberals and Green party Leader Elizabeth May are opening a last-minute push for a fuller debate on the Foreign Investment Promotion and Protection Agreement with China.

"China is just as important as the United States and we should really be treating this treaty with just the same level of public scrutiny and debate as NAFTA," said Matthew Carroll, campaigns director for Leadnow.ca, an advocacy group that organized the petition and has flooded MPs with emails and letters.

Canada and China signed the agreement at the beginning of September, and the government tabled it in the House of Commons near the end of that month. Under new rules set by the Conservatives, the agreement must be before Parliament for 21 sitting days before it can be ratified.

That time runs out on Thursday. After that, the cabinet needs to sign off on it through an order-in-council. It's not an automatic process, but the Conservatives have given every indication that ratification is imminent.

The agreement comes into force when both countries have ratified it "With this agreement, our government is bringing to Canadian investors the protection and predictability to invest with confidence in China, the world's second largest economy," Rudy Husny, a spokesman for International Trade Minister Ed Fast, said in a statement when asked if the government would be willing to hold off on ratification to allow for more debate.

The agreement has been 18 years in the making and is a replica of many other foreign investment protection agreements Canada has with its trading partners, he said.

The opposition has had ample opportunity to examine the China deal, but chose to use its four opposition days in Parliament on other subjects, he added. Plus, government officials have briefed MPs on the deal, he said.

"The NDP and the Liberals are simply misleading Canadians."

Misleading Canadians

But critics argue that the deal should have gone before parliamentary committees to be examined by experts for its implications as well as for flaws and weaknesses.

"We have a government that is refusing normal, democratic process," said the NDP industry critic Peter Julian.

May argues that the deal would give Chinese corporations — and the government that owns them — new powers to influence Canadian policy, not just in terms of investment and industrial development, but also in the realms of environment and health. And since Canada is clearly the junior partner in the trading relationship, Canadian governments at all levels will have little choice but to cater to the whims of a China desperate for natural resources.

"We become the resource colony in that context," said May.

As of the end of 2011, Chinese direct investment in Canada totalled $10.9 billion, while Canadian investment in China was $4.5 billion.

Canadian business has long complained that the investment climate in China is too uncertain to warrant major increases in investment and has repeatedly urged Ottawa to sign a deal to ensure Canadian interests are treated just like other investors in China.

But the investment agreement is going through the procedural hoops in Ottawa at a sensitive time in the Canada-China business relationship. The government is in the midst of deciding whether to approve the proposed $15.1-billion takeover of Calgary-based Nexen Inc. (TSX: T.NXY, Stock Forum), by the China National Offshore Oil Corp. (NYSE: CEO, Stock Forum).

Industry Canada has until Nov. 11 to say whether it believes the takeover is in the country's best interests — a deadline that could be extended if both Ottawa and CNOOC agree.

The CNOOC deal and the foreign investment pact are separate processes, but the federal government faces similar criticisms in its handling of both: that they have not been subject to public scrutiny and that Ottawa risks giving up too much power to the Chinese government.

Indeed, Leadnow.ca addresses both processes in the same breath: "Stop the Canada-China FIPA investment deal and Nexen takeover," the group's petition urges.

"These agreements would pave the way for a massive natural-resource buyout and allow foreign corporations to sue the Canadian government in secret tribunals."

On Tuesday, the NDP called for a debate about the treaty in the House of Commons.

"It's inconceivable that such an important treaty would be adopted without parliamentarians being able to debate it on behalf of all Canadians," said New Democrat MP Paul Dewar, the party's foreign affairs critic.

"It took 18 years to negotiate this agreement which will be in effect for 31 years. A few more months would allow us to study it thoroughly."