Canada-China Relations Committee on Dec. 11th, 2023

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Okay. Is there someone else at the department who would be familiar with that? I think you're pretty senior in the government.

[Steven Kuhn]

That's a question that I would need to check internally.

[Kyle Seeback, Conservative, Dufferin—Caledon, ON]

Well, I would like you to give an answer in writing to the committee on whether or not the Government of Canada has in place a system to ensure that any projects financed by the AIIB do not involve companies on the UFLPA list.

[The Chair, Liberal, Ken Hardie]

Right. Thank you, Mr. Seeback.

We'll now go to Ms. Yip for five minutes.

Oh, I'm sorry—

[Rob Oliphant, Liberal, Don Valley West, ON]

I'm just going to take one minute, with Ms. Yip's permission.

[The Chair, Liberal, Ken Hardie]

As you will.

[Rob Oliphant, Liberal, Don Valley West, ON]

I want to have the witnesses clarify that the legislation that the member from the opposite side is referring to is not Canadian legislation. It's American legislation. Under what authority would Canada be required to follow American legislation, or are we still sovereign?

I'm just trying to understand. This is American legislation. Is that correct? Would it apply to Canada?

[Steven Kuhn]

As I indicated to the previous member, I'm not familiar with legislation of other countries and how they would apply to various institutions. Of course, the United States is not a member of the AIIB either. However, with respect to specific issues of other countries outside of Canada, I would invite the members to speak with Global Affairs Canada about those issues.

[Rob Oliphant, Liberal, Don Valley West, ON]

Thank you.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Speaking of other countries, there are 109 countries that make up the AIIB. How have the other member countries reacted to the allegations, and what actions have they taken?

[Steven Kuhn]

Thank you for the question.

I don't want to generalize across all 108 other member countries of the institution, but it is fair to say—

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Can you give some examples of different countries rather than make an overall generalization?

[Steven Kuhn]

It is fair to say that, as part of our review, to date, we have been speaking with both regional countries in the Asia region and non-regional countries, borrower countries, non-borrower countries, and a number of issues have been raised in the review so far that have resonated with a number of those countries.

The news release that was issued on Friday named four countries in particular as countries with whom we have been having significant conversations and will continue to have significant conversations, among others, as the review continues.

It's important to recognize that for those countries that have been named, and many others we're engaged with, being named does not mean they fully agree with the allegations that have been made by the institution nor with the review that we're undertaking or the steps that might come from the review. However, their participation does signal that they think there are some important questions that need to be addressed and that they're willing to work with us in that regard.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

What are the four countries?

[Steven Kuhn]

The press release on December 8 identified Australia, Germany, Sweden and the United Kingdom as four examples of countries who, in this particular case, we have had conversations with regarding this issue in Marrakesh at the annual meetings of the World Bank and the IMF, where these conversations occur.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Are we working with them for some sort of review?

[Steven Kuhn]

We are having ongoing conversations with them and with a number of other countries to try to understand, really, what is behind the allegations and the specific issues that we have identified as meriting further discussion. Yes, we continue to have conversations.

In fact, Patrick Halley, our assistant deputy minister, who is also responsible for this review, is in Brasilia right now, where he will be meeting with G20 counterparts as well as a number of these countries to continue that conversation with them this week as well as in the coming weeks and months ahead.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

We talked about Canada's indefinite pause at the AIIB. How long has this pause been in effect? How long will it continue?

[Steven Kuhn]

The pause took effect on June 14. What the press release on Friday was making clear from the Deputy Prime Minister was that the pause would continue until the review has had a chance to complete itself.

The fact that the review is continuing is representative of the seriousness of the allegations that we have received, that we have heard, as well as some of the questions that we think warrant further work as we progress through the review.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

You wouldn't know, then, how long this review will take?

[Steven Kuhn]

No, there is no fixed timeline for the review at this stage. The review will conclude when we're satisfied that we have—

[The Chair, Liberal, Ken Hardie]

Thank you, Ms. Yip. That's your time.

We will go now to Mr. Bergeron for two and a half minutes.

[Stéphane Bergeron, Bloc, Montarville, QC]

There seems to be a gap between your assessment and Mr. Pickard's assessment as to the benefits or consequences of Canada's participation in this bank. You see benefits. Mr. Pickard, on the other hand, sees an institution that primarily serves China's interests.

Is serving China's interests a benefit?

[Steven Kuhn]

The AIIB is a multilateral organization. The 109 members of the institution, like Canada, are making choices to participate in the organization because they see something of benefit to them. I think it's fair to say that all 109 members are making decisions to participate in that institution as a result of their own interests and how those interests can play through the institution.

It is, I think, an important point to recognize, as we have been discussing throughout this testimony, that China is the largest shareholder of the institution. In fact, its voting share at the institution is nearly 27%. That is by design and by agreement. From that perspective, they do have a particular role to play in the institution that is different from that of smaller shareholders.

[Stéphane Bergeron, Bloc, Montarville, QC]

It is quite obvious that when someone joins an organization, it is because they expect to benefit. When we conduct a review based on worrisome allegations, that must automatically lead us to reevaluate what we initially considered to be benefits. I do not get that sense at all from what you are saying.

I would also like to pick up on what Ms. Yip said a few minutes ago. In your recent press release, there is indeed reference to discussions with Australia, Germany, Sweden and the United Kingdom.

Would you say that our counterparts from those four countries share a number of those concerns? I am talking about the concerns that led the Canadian government to suspend its participation indefinitely.