Visit of U.S. Secretary of State to Montreal
Canada Told to Fall in Line with U.S. Attempts to Further Isolate China and Russia
On Friday October 28, François-Philippe Champagne, Minister of Innovation, Science and Industry, and Jonathan Wilkinson, Minister of Natural Resources, issued a press release entitled "Canada strengthens guidelines to protect critical minerals sectors from foreign state-owned enterprises."
The announcement was made during the two-day official visit of U.S. Secretary of State Antony Blinken to Canada. His two-day visit to Canada served in part to promote the integration of Canada's critical mineral supply chain into the U.S. economy. On day two of the visit Blinken was in Montreal, along with Canada's Minister of Foreign Affairs, Mélanie Joly, to visit a pilot plant for recycling lithium-ion batteries from electric vehicles.
On October 11, Deputy Prime Minister Chrystia Freeland had already told a gathering at the Brookings Institution in Washington D.C. that a deepening of trade ties between countries that espouse "liberal democracy" is necessary to combat "powerful authoritarian regimes" such as Russia and China that "are fundamentally hostile to us." She added that this "means we need to be cautious about our economic relations with the world's dictators and their elites [...] We should continue to trade, but we should avoid strategic vulnerabilities in our supply chains and our economies more broadly."
In the same vein, the October 28 press release stated that, "Starting today, significant transactions by foreign state-owned enterprises in Canada's critical minerals sectors will only be approved as of likely net benefit on an exceptional basis. As well, should a foreign state-owned company participate in these types of transactions, it could constitute reasonable grounds to believe that the investment could be injurious to Canada's national security, regardless of the value of the transaction."
As to the importance and value of these transactions, the Trudeau government states the following in the updated Policy Regarding Foreign Investments from State-Owned Enterprises (SOE) in Critical Minerals under the Investment Canada Act:
"Critical Minerals are also strategic assets that contribute to Canada's national security as vital inputs to defence and high technology. In this context, some investments into Canada by SOEs can be motivated by non-commercial imperatives that are contrary to Canada's interests." this would also include "investments from private investors assessed as being closely tied to, subject to influence from, or who could be compelled to comply with extrajudicial direction from foreign governments, particularly non-likeminded governments."
The Trudeau government defines an SOE this way: "For the purposes of these guidelines, an SOE is an enterprise that is owned, controlled or influenced, directly or indirectly by a foreign government."
The document goes on to say that "Under the Act, the Minister of Innovation, Science and Industry must approve proposed acquisitions of control from foreign investors, including SOEs, where the value of the Canadian business is above the defined threshold."
For 2022, the thresholds are "$1.141 billion in enterprise value for investments to directly acquire control of a Canadian business" by private sector WTO and non-WTO investors that are not state-owned enterprises, "$1.711 billion in enterprise value for investments to acquire control of a Canadian business by trade agreement investors that are not state-owned enterprises and by non-trade agreement investors that are not state-owned enterprises [...]" and "$454 million in asset value for investments to directly acquire control of a Canadian business by WTO investors that are state-owned enterprises and non-WTO investors that are state-owned enterprises where the Canadian business that is the subject of the investment[...] is controlled by a WTO investor."
As part of the changes made to the Investment Canada Act, guidelines are being given as to what criteria to follow when it comes to state-owned enterprises, called the net benefit assessment. Some of the criteria will include an examination of "whether the non-Canadian adheres to Canadian standards of corporate governance (including, for example, commitments to transparency and disclosure, independent members of the board of directors, independent audit committees and equitable treatment of shareholders), and to Canadian laws and practices, including adherence to free market principles." The examination "will also cover how and the extent to which the non-Canadian is owned, controlled by a state or its conduct and operations are influenced by a state."
All of this gibberish about examination of "foreign influence" by a state and "adherence to free market principles" is to hide the fact that it is the U.S. administration which dictates the line of march the Trudeau government is to take and this line of march is to integrate Canada's economy into the U.S. war economy. Canada's sovereignty is trampled in the mud in the name of high ideals.
Here is what the October 28 statement released by François-Philippe Champagne, Minister of Innovation, Science and Industry, and Jonathan Wilkinson, Minister of Natural Resources, titled "Canada strengthens guidelines to protect critical minerals sectors from foreign state-owned enterprises," said, in part:
"Critical minerals are essential to powering the green, digital economy of tomorrow. Increasing demand and constrained supply of these all-important minerals are presenting Canada with a generational economic opportunity, and the Government of Canada is committed to seizing that opportunity while delivering on its ambitious climate goals.
"That is why Canada must build strategic resilience in the North American critical minerals supply chain with like-minded partners at home, within North America, and around the world.
"While we continue to welcome foreign direct investment that supports this goal, Canada will act decisively when investments threaten our national security and our critical minerals supply chains. To this end, Minister Champagne is providing additional direction with regard to the application of the Investment Canada Act in cases involving critical minerals and critical minerals supply chains."
This article was published in
Volume 52 Number 10 - October 2022