10 August 2009

Flaherty urges China to cash in with Canada

This article is excerpted from the 10 August 2009 edition of the “Toronto Star”.

Canada's banks are on display in China this week as Finance Minister Jim Flaherty tries to woo officials there.

Flaherty told reporters from Beijing he hopes his visit will spur Chinese investment in Canada's resource and financial service sectors….

The China trip – Flaherty's second as finance minister – is meant to court the country's coveted market as exports slow to the United States, Canada's largest trading partner.

A battered housing market, weak consumer spending and massive government deficits threaten to keep the American economy, the world's biggest, on the skids for a while longer….

Enter China.

"China has a need for resources. China has . . . substantial U.S. dollar cash reserves," Flaherty said. "China is looking for investments abroad, Commercial investments, subject to proper governance, are welcomed in Canada.

"I think, over time, we will see more investment by Chinese businesses in Canada. I think, over time, we'll also see growth by our financial institutions in this market, which is just a terrific prospective market for our banks and insurance companies based in Canada that operate globally."…

It's the largest Canadian business delegation to China in years.

Relations between Ottawa and Beijing were seriously strained after the Conservatives took office in 2006 following a series of statements and policy moves that rankled the Chinese….

But Sino-Canadian relations are improving….

The visit also lays the groundwork for Harper's first trip to China later this year. The prime minister, who has not visited China during three years in office, was noticeably absent from last year's Olympic Games in Beijing….