The National Post is Canada’s second largest national paper.
Canadians are about to discover that Prime Minister Stephen Harper has caught China fever. The Prime Minister arrives Tuesday in Beijing to shout that Canada is open for business.
Australia caught China fever some years ago and because of it the Land Down Under has been creating a staggering amount of wealth out of one of the greatest resource booms of all time.
To little fanfare elsewhere, Australia’s trade to China has tripled over the past five years to more than $60-billion a year.
When imports are included, trade between the countries is $80-billion a year, compared with a relatively piddling $30-billion a year of trade between Canada and China.
Moreover, Australia enjoys a three-to-one trade imbalance with China while Beijing has a formidable four-to-one trade advantage over Canada.
But you ain’t seen nothing yet.
China has agreed to take $90-billion in natural-gas exports from a field in Queensland while $75-billion is being spent to develop two other natural-gas fields in northwestern Australia that promise much bigger exports to Asia.
Small wonder then that any Canadian government would want to get in on such a bonanza.
As good as trade with China has been for Australia, its relationship with the emerging superpower is complicated, and there are lessons in it for Ottawa, which hopes to sign a deal for Canadian natural gas to be shipped to China through a marine export terminal under construction in Kitimat, B.C.
Aside from purchasing raw materials and buying resource companies, China has been keenly interested in acquiring fully integrated agricultural businesses that include land for grazing, sugar, cotton and vineyards, as well as food-processing plants and market-delivery systems.
Some Australian skeptics have expressed alarm at this unprecedented buying spree and have demanded that the country’s Foreign Investment Review Board get tougher on China investments.
The flip side of the argument has been that blocking such deals would inhibit the kind of massive investments that Australia needs and that its own financial sector lacks the cash to make.
As in Canada, among the other points of concern have been China’s human-rights record and its ambitions in the South China Sea, where there is a web of competing territorial claims.
Alongside Australia’s trade relationship with China, the two countries have met 13 times since 1997 to discuss human rights.
For the rest of this article, please go to the National Post website: http://www.financialpost.com/todays-paper/Australia+China+relationship+lesson+Ottawa/6111360/story.html