Fear of Chinese competition fuels Ottawa’s foreign-policy shift

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The Conservatives' new plan to make mercantile interests and deals in emerging markets the driver of Canadian diplomacy is not motivated only by concern about competing in China – it is much more about competing with China.

Behind Trade Minister Ed Fast's Global Markets Action plan were months of thinking in the Conservative government about the competition Canadian firms face – notably the aggressive Chinese push for business in foreign countries that includes bundling aid with deals, bartering infrastructure for oil concessions, and using its diplomatic muscle to help its companies win contracts.

Inside the senior ranks of Prime Minister Stephen Harper's government, one inspiration was a 2012 article in the journal Foreign Affairs entitled How to Succeed in Business, And Why Washington Should Really Try. The piece, by Alexander Benard, an emerging-markets investment banker and foreign-policy writer, decries the failure of the U.S. State Department to help businesses while China's companies gain contracts – even scooping up an oil deal in Afghanistan.

Now, Canada's government has unveiled a policy that echoes some of Mr. Benard's recommendations: making aid and trade work together, marshaling other government resources to open emerging markets, and above all, making business a diplomat's business.

It is a shift of narrative in Canada's diplomacy. Pearsonian foreign policy was based on the notion that a rising tide lifts all boats: Multi-lateralism and building international order and development would help global growth, and Canada's economy, too. The Harper foreign policy is now explicitly based on lifting Canadian boats first and foremost.

But the plan's substance lies in how far it is taken – and whether it is taken literally.

Its undeniable virtue is in recognizing an accelerating shift in where Canada's economic interests lie, and the need for government to change too. That is a broad foreign policy imperative, beyond just trade, because Canada's political interests, broadly speaking, will travel with its economic interests.

The flaw lies in the over-bold assertion that all Canada's foreign-policy tools will be used to make deals for the private sector. A literal reading suggests a subjugation of other international interests. Mr. Harper's critics called that dangerous.

"Does that mean we won't do peace and security any more? What about human rights? What about democratic development?" said New Democrat MP Hélène Laverdière, a former diplomat. "It's shifting down the rest, and it's going to be a very unbalanced foreign policy."

Derek Burney, a former ambassador to the United States and chief of staff to Brian Mulroney, called that a simplistic criticism that reads too much into a little hyperbole in the plan to reorganize trade promotion. "People are saying, 'Oh, woe is me, the world is coming to an end. We're no longer going to be voting at the UN on a regular basis.' This is nonsense," he said.

That's perhaps too much understatement: Mr. Harper clearly sees part of his legacy in shifting foreign policy and the emphasis of the foreign-service corps. All diplomats will be told to think of economics as their mission too, one official said.

The travels of Foreign Affairs Minister John Baird have established business as a priority, and that foreign policy often follows trade. He recently signed an agreement in Kazakhstan important to the uranium business of Saskatchewan's Cameco; he is pursuing diplomatic, defence, and other political relations with southeast Asia's ASEAN bloc because of its trade potential.

Ms. Laverdière noted that the plan puts in black and white that Canada will align foreign aid to trade interests, although by law, poverty reduction is the goal of aid. In places like China, the diplomat raising human rights concerns will have to view business deals as a priority, too, she said. "And the message it sends to other countries is, we're interested in you insofar as we can sell our stuff."

That message is important, according to Mr. Benard's 2012 article. He argued that the United States should not use full-blown "dollar diplomacy" because single-mindedness is already backfiring for China, and for U.S. business, a better reputation as a less rapacious partner is an asset.

Mr. Harper has clearly accepted another one of Mr. Benard's conclusions: that given the competition, it is no time to be timid.

Campbell Clark is a columnist in The Globe's Ottawa bureau.