Ottawa: Canada has released a long-awaited plan to boost military and cybersecurity in the Indo-Pacific region and vowed to deal with a “disruptive” China while working with it on climate change and trade issues.

The C$2.3 billion ($2.5 billion) plan detailed in a 26-page document said Canada would tighten foreign investment rules to protect intellectual property and prevent Chinese state-owned enterprises from snapping up critical mineral supplies.

Tensions between Ottawa and Beijing soared in late 2018 after Canadian police detained a Huawei executive and Chinese authorities subsequently arrested two Canadians on spying charges. All three were released last year, but relations remain sour.

Chinese President Xi Jinping and Canadian PM Justin Trudeau at an earlier G20 Summit in Japan.Credit:The Canadian Press/AP

Earlier this month Canada ordered three Chinese companies to divest their investments in Canadian critical minerals, citing national security.

This month, during a G20 meeting in Bali, the tensions burst into the open when Chinese President Xi Jinping confronted Prime Minister Justin Trudeau on camera about a leak of their previous conversation to the press.

The plan, in a section mentioning China, said Ottawa would review and update legislation enabling it to act “decisively when investments from state-owned enterprises and other foreign entities threaten our national security, including our critical minerals supply chains.”

Canada is seeking to deepen ties with a fast-growing Indo-Pacific region of 40 countries accounting for almost C$50 trillion in economic activity. But the focus is on China, which is mentioned more than 50 times in the document.

Four cabinet ministers took turns detailing the new plan at a news conference in Vancouver, saying the strategy was crucial for Canada’s national security and climate as well as its economic goals.

“We will engage in diplomacy because we think diplomacy is a strength, at the same time we’ll be firm and that’s why we have now a very transparent plan to engage with China,” Foreign Minister Melanie Joly said.

Trudeau’s Liberal government wants to diversify trade and economic ties that are overwhelmingly reliant on the United States. Official data for September show bilateral trade with China accounted for under 7 per cent of the total, compared to 68 per cent for the US.

The document underscored Trudeau’s dilemma in forging ties with China, which offers significant opportunities for Canadian exporters.

Yet, it said cooperation with the world’s second-biggest economy was necessary to address some “existential pressures”, including climate change, global health and nuclear proliferation.

“China is an increasingly disruptive global power,” said the strategy. “Our approach … is shaped by a realistic and clear-eyed assessment of today’s China. In areas of profound disagreement, we will challenge China.”

The document said Canada would boost its naval presence in the Indo-Pacific region and “increase our military engagement and intelligence capacity as a means of mitigating coercive behaviour and threats to regional security”.

That would include annual deployment of three frigates to the region, from two currently, as well as participation of Canadian aviators and soldiers in regional military exercises, Defence Minister Anita Anand said at a separate news conference.

It said Ottawa was engaging in the region with partners such as the United States and the European Union.


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