Canada would benefit from a closer relationship with Taiwan, writes Dean Karalekas. First steps should include negotiating a Foreign Investment Promotion and Protection Agreement and supporting Taiwan’s inclusion in the Trans-Pacific Partnership 2.0 talks.

By Dean Karalekas, Jan. 26, 2018

In late January 2018, a Canadian parliamentary delegation led by the Honourable Bob Nault, PC, MP, visited Taiwan. President Tsai Ing-wen and several other government representatives met with the Canadian parliamentarians to discuss trade, and to express Taiwan’s desire to be a part of Canada’s resurrection of the Trans-Pacific Partnership. In addition to trade issues, the leaders discussed matters of security as well, including the recent unilateral imposition by the People’s Republic of China (PRC) of the M503 air route: a move that puts the delicate state of cross-strait peace at risk.

As is the norm in such visits, the Taiwanese hosts were keen to showcase not just their country’s economic attributes, but its values as well. The economic and trade ties between Taiwan and Canada are strong: according to the Government of Canada, Taiwan is Canada's 11th-largest trading partner, with merchandise trade in 2016 reaching $6.7 billion and Canadian exports rising 8.8 percent to $1.59 billion. Several Memoranda of Understanding have been signed, including most recently an Avoidance of Double Taxation Arrangement and one on Telecommunications Cooperation.

“As a country that promotes the rule of law and embraces free and open markets, Taiwan represents a golden opportunity for Canadian businesses to expand their trade and investment opportunities within the Asia-Pacific region,” The Honourable Ed Fast, PC, QC, MP, a member of the Canadian delegation, was reported as saying. “Our engagement with Taiwan's leaders highlighted our mutual desire to deepen our economic and people-to-people relationships,” he added.

Just what is it about Taiwan that makes it such an attractive place for Canadians to live?

Indeed, those people-to-people relationships are the bread and butter of Taiwan-Canada ties. For one thing, Taiwan is home to one of the largest communities of overseas Canadians in the world, with an estimated 60,000 Canadians living there. Just what is it about Taiwan that makes it such an attractive place for Canadians to live? Economic opportunities are certainly high on the list. But the shared values undoubtedly factor into the decision: values that include tolerance, diversity, and respect for human rights. Unfortunately, the government of Canada is lagging behind these intrepid Canadians in its appreciation for just how beneficial this relationship can be.

Fair or not, Ottawa’s relationship with Taipei is often played as a zero-sum game, with Beijing threatening to retaliate – often economically – for any perceived amelioration in ties. This makes countries like Canada apprehensive about getting too close to Taiwan, and it is why leaders in Taipei go to such great lengths to highlight values.

Unlike China, Taiwan and Canada are thriving democracies where citizens have a voice in how the government is run. Unlike China, Taiwan and Canada believe in the international rules and norms that help preserve global peace and security. Unlike China, Taiwan and Canada respect human rights, with both embracing such issues as same-sex marriage. Yet unlike Taiwan and Canada, China remains in an 18th-century mindset of expansion and colonization, and continues to threaten – by force if necessary – to annex Taiwan. This is despite the fact that Taiwan is not, and has never been, a territory of the People’s Republic of China.

In any other context, Canada would surely side against the obvious bully. Yet, in the cross-strait scenario, Ottawa seems loath to cross Beijing. This is especially true since the ascendance of Justin Trudeau as Prime Minister. It was Trudeau, one should recall, who attended Liberal Party cash-for-access fundraisers that generated hundreds of thousands of dollars from Chinese billionaires, raising ethical concerns. Trudeau also okayed the takeover by a Chinese investor of Norsat International Inc., a Vancouver satellite communications firm with contracts with the US Department of Defense –  a takeover that has obvious national security implications and rightly went into review soon after the sale. This latest controversy seems destined to be repeated. Aecon Group Inc., a prestigious Canadian construction and engineering firm, is now the target of acquisition by the investment arm of the state-owned China Communication Construction Co. (CCCC), well known for building the now infamous artificial islands in the South China Sea that contributed to rising tensions in the Indo-Pacific region.

Unlike Taiwan and Canada, China remains in an 18th-century mindset of expansion and colonization

Given this track record, it is little wonder that Trudeau was so keen to ink a free trade pact with the PRC last year. The effort only went south when Beijing refused to accede to a number of ideological stipulations on such issues as gender equality and the environment. Ironically, it is exactly these issues where Canada and Taiwan are in harmony, and on which Taipei would enthusiastically agree.

Canada only stands to benefit from a closer relationship with Taiwan. As argued by J. Michael Cole recently in the Globe and Mail, Taiwan has experience dealing with the very problems that Canadian businesses and officials are now facing, including how to protect against Chinese theft of Canadian intellectual property, as well as how to counter Chinese intelligence operations and the covert exerting of influence from Beijing on Canadian officials, businessmen, and community leaders. This latter problem is rarely, if ever, addressed by Canadian politicians or our media, but it remains a widespread and potentially dangerous phenomenon that threatens Canada’s security and economy.

Canada could also benefit from Taiwan’s experience in defending against cyberattacks launched against Canadian infrastructure and businesses by Beijing. This problem is also one that does not receive much attention in the media, but it is happening at such a level and frequency that it would be alarming if the Canadian public were not kept blissfully in the dark. Taiwan has long been the testing ground for many of the hacking techniques now employed against Canada by China’s police and intelligence service, the Ministry of State Security, and other cyber spying bodies in the Middle Kingdom.

Canada shares just one thing with China, and that is a desire to make money. With Taiwan, we share that, plus a host of other important values. In the words of the Hon. Bob Nault, “Based on what we heard during our numerous meetings and discussions, it is clear that Taiwan strongly embraces the values of democracy, freedom, and cultural diversity. It is also very encouraging to see the efforts of their government to address the historical injustices made towards Taiwan's indigenous communities, and the importance they place on protecting the environment and developing green energy."

How to begin? Opening negotiations on a Foreign Investment Promotion and Protection Agreement (FIPA) deal between the two countries as a means of increasing foreign investments would be a good place to start. As would Canada’s support for Taiwan’s inclusion in future talks surrounding the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). It would demonstrate that Ottawa is taking its relationship with its allies seriously and help to dispel the impression that the Trudeau government is not able or willing to stand up to China on matters of principal.

Dean Karalekas is a former professor of Asia-Pacific Studies and serves as Associate Editor of the security journal Strategic Vision. He is currently based in New York City.