Some of China’s resource companies feel they have been misled by investment-seeking Canadian governments about just how difficult it is to establish successful mines in Canada, Ottawa’s ambassador to Beijing has warned.
That sour note may help to explain declines in Chinese investment in Canada in favour of the United States, and serves as a backdrop to recent diplomatic jousting between the two countries. An internal report last October by Ambassador Guy Saint-Jacques details a raft of complaints from an official with the China Mining Council about the unwanted surprises some mining companies encountered in Canada.
Wang Jiahua’s “concerns seem to centre mostly in what he called less-developed, remote areas, where climate is harsh, infrastructure is less developed, and workforce is scarce,” Saint-Jacques wrote.
“Some members felt that, when promoting potential investment projects, the provinces did not disclose the full picture about the mining environment, namely the risks and challenges, and that this led to misinformed decision.”
“Mr. Wang emphasized repeatedly the need for the Canadian side to be more comprehensive and forthcoming when presenting the mining environment in various regions of Canada.” The obstacles should be “more clearly flagged.”
Saint-Jacques’s Oct. 13, 2015, report, circulated within Global Affairs as well as Natural Resources Canada, was obtained by CBC News under the Access to Information Act.
Investors seek changes
The document provides a behind-the-scenes glimpse into troubled Chinese mining investments in Canada.
Many have failed as commodity prices decline and companies run up against “harsh climate, poor infrastructure, scarce workforce, foreign temporary worker limitations and regulatory requirements,” as cited in a related document from Natural Resources Canada.
Wang also cited Canada’s immigration policies as a barrier, because they “make it impossible for Chinese investors to bring Chinese labour to Canada to work on mine construction, resulting in a timeframe of 8-10 years to project start, vs. 1-2 years if Chinese labour was allowed,” Saint-Jacques noted.
A former Canadian ambassador to Beijing calls the complaints an example of “negotiation by other means,” and that the real goal is to put pressure on Canada to set aside its domestic restrictions.
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