“We are sitting ducks.”
That’s the way Anthony Campbell, the former head of the Intelligence Assessment Secretariat of the Privy Council Office, put it to me the other day. We were talking about Beijing’s designs on Canada’s energy resources, Beijing’s adroit cunning in enfeebling Canadian foreign policy, and how Canadians have been rendered unable to cope with the drama as it unfolds.
The Chinese Year of the Dragon began inauspiciously with Prime Minister Stephen Harper and Industry Minister Joe Oliver riffing on a clever talking-points stratagem dreamed up by neophyte Conservative war-room hangabouts. It featured American billionaire socialists infiltrating into Canada to ambuscade the construction of Canada’s last-hope economic lifeline, to China.
Most Canadians had probably never even heard of the Enbridge project, which is a plan to build a huge bitumen tube from Alberta’s oilsands to saltwater on the northern British Columbia coast. Still, whatever Ottawa was shouting about, it seemed to contain enough resemblance to a kernel of truth. So it worked for a while.
But what Harper and Oliver inadvertently opened up was a nasty and troubling question that nobody in Ottawa is particularly happy to hear people asking. Just what legally constitutes a foreign activity in Canada that is detrimental to this country’s national security interests these days, anyway?
As it turns out, Canada is practically incapable of answering that question with any enforceable coherence. When it comes to the recent and rapid-succession manoeuvres that have given Chinese state-owned entities the spigot key at critical flow points in Canada’s oil and gas industry, mysteries abound. But it is now clear that slowly but surely, Canada’s regulatory defences have been almost completely hollowed out.
A mere political millisecond ago, Canada was in an uproar over the Beijing-owned China Minmetals’ $4.7-billion bid to take over the Canadian mining giant Noranda. Beijing backed off in 2005, but the scare was enough to convince Ottawa that it needed to get around to closing the troubling Investment Canada Act loopholes that could easily allow foreign-government entities to easily take over Canadian economic assets unless someone was playing really close attention. But the loopholes weren’t closed, and the problem has only got worse.
After the China Minmetals scare, Industry Canada set up a Competition Policy Review panel that was supposed to come up with the means to cope with the national-security implications of foreign-government takeovers, but that key task was taken back from the panel in October, 2007. Two months later, Industry Canada quietly disclosed that the “national security” questions arising from takeovers by foreign government entities would be looked at through the same regulatory binoculars that Ottawa uses to examine investments in Canadian companies by private foreign firms.
Then, against the advice of intelligence experts and even some of the Conservative government’s closest friends, the federal cabinet approved regulations under the Act that deliberately avoided a definition of the term “national security.” Expert advice had called for the national-security implications to be spelled out in “concrete, objective, and transparent criteria.” Cabinet said no.
That’s the way Anthony Campbell, the former head of the Intelligence Assessment Secretariat of the Privy Council Office, put it to me the other day. We were talking about Beijing’s designs on Canada’s energy resources, Beijing’s adroit cunning in enfeebling Canadian foreign policy, and how Canadians have been rendered unable to cope with the drama as it unfolds.
The Chinese Year of the Dragon began inauspiciously with Prime Minister Stephen Harper and Industry Minister Joe Oliver riffing on a clever talking-points stratagem dreamed up by neophyte Conservative war-room hangabouts. It featured American billionaire socialists infiltrating into Canada to ambuscade the construction of Canada’s last-hope economic lifeline, to China.
Most Canadians had probably never even heard of the Enbridge project, which is a plan to build a huge bitumen tube from Alberta’s oilsands to saltwater on the northern British Columbia coast. Still, whatever Ottawa was shouting about, it seemed to contain enough resemblance to a kernel of truth. So it worked for a while.
But what Harper and Oliver inadvertently opened up was a nasty and troubling question that nobody in Ottawa is particularly happy to hear people asking. Just what legally constitutes a foreign activity in Canada that is detrimental to this country’s national security interests these days, anyway?
As it turns out, Canada is practically incapable of answering that question with any enforceable coherence. When it comes to the recent and rapid-succession manoeuvres that have given Chinese state-owned entities the spigot key at critical flow points in Canada’s oil and gas industry, mysteries abound. But it is now clear that slowly but surely, Canada’s regulatory defences have been almost completely hollowed out.
A mere political millisecond ago, Canada was in an uproar over the Beijing-owned China Minmetals’ $4.7-billion bid to take over the Canadian mining giant Noranda. Beijing backed off in 2005, but the scare was enough to convince Ottawa that it needed to get around to closing the troubling Investment Canada Act loopholes that could easily allow foreign-government entities to easily take over Canadian economic assets unless someone was playing really close attention. But the loopholes weren’t closed, and the problem has only got worse.
After the China Minmetals scare, Industry Canada set up a Competition Policy Review panel that was supposed to come up with the means to cope with the national-security implications of foreign-government takeovers, but that key task was taken back from the panel in October, 2007. Two months later, Industry Canada quietly disclosed that the “national security” questions arising from takeovers by foreign government entities would be looked at through the same regulatory binoculars that Ottawa uses to examine investments in Canadian companies by private foreign firms.
Then, against the advice of intelligence experts and even some of the Conservative government’s closest friends, the federal cabinet approved regulations under the Act that deliberately avoided a definition of the term “national security.” Expert advice had called for the national-security implications to be spelled out in “concrete, objective, and transparent criteria.” Cabinet said no.
Instead, the September 2009 regulations granted whichever minister happened to be in charge of the industry and investment portfolio the discretion to decide for himself whether a “national security” threat was present in a bag of foreign money, on a bag by bag and case by case basis. Even private investment dealers have been flummoxed by it all. Cabinet pledges to clarify things have also gone by the wayside.
The upshot was that Canada’s foreign investment criteria ended up failing to explain what “national security” means, or to make regulatory distinction between ordinary private investors like, say, upstart roughnecks from Utah, and, say, entities like Sinopec, a secretive Chinese state-owned enterprise that answers to the Communist Party Central Committee in Beijing.
The result was a three-year barrage of Beijing-directed investments, takeovers, joint venture deals and property buys across Canada’s energy sector, and Sinopec is now a pivotal “stakeholder” in Canada’s energy decisions.
The most jaw-dropping of all these manoeuvres involves the way-above-market sum of $4.6 billion that Sinopec paid for Conoco Phillips’ minority stake in Syncrude in April, 2010. Why was Sinopec so desperate for it? Syncrude is Canada’s biggest producer of synthetic crude. The big prize in the Conoco Phillips stake was the veto the deal gave Sinopec over any Syncrude decision to keep the jobs and investment benefits of upgrading and refining its bitumen here in Canada.
Beijing wants Canada’s bitumen so that it can upgrade and refine it and sell it from China or just pump it into the supply lines that feed the vast industrial slave camps that Sinopec and its allied state monopolies command back in Fujian and Guangdong. Sinopec had barely settled into its director’s chair at Syncrude’s board table when it revealed that it was partnering on Enbridge Inc.’s proposed $6-billion pipeline from the oilsands to awaiting supertankers at Kitimat on the B.C. coast.
Checkmate.
Well, that’s odd, you might say. Isn’t this the same pipeline that Harper and Industry Minister Oliver are now calling a project that is vital to Canada’s national interests? Anyone can see how it’s in Beijing’s interests. But Canada’s?
It all depends on what you mean when you talk like that.
Way back in the 1980s, the Security Intelligence Review Committee was urging amendments to the Canadian Security Intelligence Service Act to spell out what Canadians mean when we talk about foreign-power connivings that are “detrimental” to Canada’s national interests. “It is almost wholly subjective: no criteria are provided to offer any standard for determining what is ‘detrimental’,” a SIRC report once pointed out.
The definitions in the CSIS Act still don’t clearly define what “detrimental” means, but unlike Investment Canada, CSIS has muddled through and is properly content to couple Canada’s “national security” with “the security and economic welfare of Canada.” Until late last year, Harper himself was happy to use language just like that whenever he returned to his solemn vow to keep Alberta’s oilsands jobs and investment opportunities in Canada, and not ship bitumen offshore to countries with haywire environmental rules like China. It was a Conservative party pledge in 2006 and 2008 and 2010.
The upshot was that Canada’s foreign investment criteria ended up failing to explain what “national security” means, or to make regulatory distinction between ordinary private investors like, say, upstart roughnecks from Utah, and, say, entities like Sinopec, a secretive Chinese state-owned enterprise that answers to the Communist Party Central Committee in Beijing.
The result was a three-year barrage of Beijing-directed investments, takeovers, joint venture deals and property buys across Canada’s energy sector, and Sinopec is now a pivotal “stakeholder” in Canada’s energy decisions.
The most jaw-dropping of all these manoeuvres involves the way-above-market sum of $4.6 billion that Sinopec paid for Conoco Phillips’ minority stake in Syncrude in April, 2010. Why was Sinopec so desperate for it? Syncrude is Canada’s biggest producer of synthetic crude. The big prize in the Conoco Phillips stake was the veto the deal gave Sinopec over any Syncrude decision to keep the jobs and investment benefits of upgrading and refining its bitumen here in Canada.
Beijing wants Canada’s bitumen so that it can upgrade and refine it and sell it from China or just pump it into the supply lines that feed the vast industrial slave camps that Sinopec and its allied state monopolies command back in Fujian and Guangdong. Sinopec had barely settled into its director’s chair at Syncrude’s board table when it revealed that it was partnering on Enbridge Inc.’s proposed $6-billion pipeline from the oilsands to awaiting supertankers at Kitimat on the B.C. coast.
Checkmate.
Well, that’s odd, you might say. Isn’t this the same pipeline that Harper and Industry Minister Oliver are now calling a project that is vital to Canada’s national interests? Anyone can see how it’s in Beijing’s interests. But Canada’s?
It all depends on what you mean when you talk like that.
Way back in the 1980s, the Security Intelligence Review Committee was urging amendments to the Canadian Security Intelligence Service Act to spell out what Canadians mean when we talk about foreign-power connivings that are “detrimental” to Canada’s national interests. “It is almost wholly subjective: no criteria are provided to offer any standard for determining what is ‘detrimental’,” a SIRC report once pointed out.
The definitions in the CSIS Act still don’t clearly define what “detrimental” means, but unlike Investment Canada, CSIS has muddled through and is properly content to couple Canada’s “national security” with “the security and economic welfare of Canada.” Until late last year, Harper himself was happy to use language just like that whenever he returned to his solemn vow to keep Alberta’s oilsands jobs and investment opportunities in Canada, and not ship bitumen offshore to countries with haywire environmental rules like China. It was a Conservative party pledge in 2006 and 2008 and 2010.
But the rules had got hollowed out, and after Sinopec’s checkmate at the Syncrude table, everything went sideways.
Now, Harper is insisting it’s Enbridge’s Sinopec-backed bitumen-export project that is in Canada’s national interests. It’s positively vital to Canada’s interests and furthermore, it’s something we must all rally around because Canada’s very future depends on it.
This does seem a bit of a switch. It’s a bit like the way it was not long ago at the World Trade Organization and at the G8, when Harper was the one dependable champion of the voiceless Tibetans, the human rights activists and the democrats that the regime in Beijing so mercilessly exploits and persecutes and torments. That’s gone, too. Believe whatever you like.
Just don’t for one minute believe the unrequited love story version with a teary-eyed Harper driven into the arms of Chinese president and Communist Party boss Hu Jintao after U.S. President Barack Obama so cruelly rebuffed his “no-brainer” offer of the Keystone XL bitumen pipeline from Alberta to refineries on the U.S. Gulf Coast. It is a fable, on three grounds.
Harper was already irredeemably estranged from Obama by then and he’d already been offering the Enbridge pipeline in sweet entreaties to Jintao before the Obama rebuff. There’s already enough pipeline capacity to move Alberta bitumen south without either Keystone or Enbridge. Hollywood eco-billionaires can throw as many victory parties as they want but all the Obama White House did was tell Keystone to jimmy with a dodgy part of its application and submit it again later.
Keystone will do just that, too, just as soon as the Americans have decided whether to stick with their handsome Democratic Party incumbent or try their luck with whichever one of those gargoyles the Republicans end up picking. Whoever ends up winning, you can count on it that already, American trade negotiators are dusting off their copies of the North American Free Trade Agreement to find the part that says Canada can cut China in on the deal without asking anybody else.
Sinopec is now number five on the Fortune Global 500 list. It’s receipts last year eclipsed the tax revenues collected by the government of Canada. Sinopec did not get this way because of entrepreneurial ingenuity and innovation. Sinopec got that way because it is Beijing’s most favoured overseas legion.
Sinopec has managed to get away with being Iranian president Mahmoud Ahmadinejad’s most reliable sanctions-busting ally. It succeeded as the protector of the genocidaire Omar al-Bashir’s regime in Khartoum. It’s still getting away with being the guarantor of the mass murderer Bashar al-Assad’s bottomless bank account in Damascus. And Sinopec is Canada’s new best friend.
Now, Harper is insisting it’s Enbridge’s Sinopec-backed bitumen-export project that is in Canada’s national interests. It’s positively vital to Canada’s interests and furthermore, it’s something we must all rally around because Canada’s very future depends on it.
This does seem a bit of a switch. It’s a bit like the way it was not long ago at the World Trade Organization and at the G8, when Harper was the one dependable champion of the voiceless Tibetans, the human rights activists and the democrats that the regime in Beijing so mercilessly exploits and persecutes and torments. That’s gone, too. Believe whatever you like.
Just don’t for one minute believe the unrequited love story version with a teary-eyed Harper driven into the arms of Chinese president and Communist Party boss Hu Jintao after U.S. President Barack Obama so cruelly rebuffed his “no-brainer” offer of the Keystone XL bitumen pipeline from Alberta to refineries on the U.S. Gulf Coast. It is a fable, on three grounds.
Harper was already irredeemably estranged from Obama by then and he’d already been offering the Enbridge pipeline in sweet entreaties to Jintao before the Obama rebuff. There’s already enough pipeline capacity to move Alberta bitumen south without either Keystone or Enbridge. Hollywood eco-billionaires can throw as many victory parties as they want but all the Obama White House did was tell Keystone to jimmy with a dodgy part of its application and submit it again later.
Keystone will do just that, too, just as soon as the Americans have decided whether to stick with their handsome Democratic Party incumbent or try their luck with whichever one of those gargoyles the Republicans end up picking. Whoever ends up winning, you can count on it that already, American trade negotiators are dusting off their copies of the North American Free Trade Agreement to find the part that says Canada can cut China in on the deal without asking anybody else.
Sinopec is now number five on the Fortune Global 500 list. It’s receipts last year eclipsed the tax revenues collected by the government of Canada. Sinopec did not get this way because of entrepreneurial ingenuity and innovation. Sinopec got that way because it is Beijing’s most favoured overseas legion.
Sinopec has managed to get away with being Iranian president Mahmoud Ahmadinejad’s most reliable sanctions-busting ally. It succeeded as the protector of the genocidaire Omar al-Bashir’s regime in Khartoum. It’s still getting away with being the guarantor of the mass murderer Bashar al-Assad’s bottomless bank account in Damascus. And Sinopec is Canada’s new best friend.
We are all sitting ducks.
Original Article
Source: ottawa citizen
Author: Terry Glavin
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