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

[Steven Kuhn]

Thank you for the question.

Before going directly to the question, there's one point I would like to clarify. The review is ongoing. If I leave members with the impression that the Government of Canada has reached a conclusion with respect to elements of the testimony, I apologize for that. The review is ongoing. We continue to look at various elements of it.

With respect to other countries and their perspectives on these issues, I don't think it's for me to speculate on what specific issues they may or may not share with us with respect to the institution or how their governments may be thinking about their continued involvement in the institution.

[Stéphane Bergeron, Bloc, Montarville, QC]

I am not talking about speculation...

[The Chair, Liberal, Ken Hardie]

I'm sorry, Mr. Bergeron. Your time has expired.

[Stéphane Bergeron, Bloc, Montarville, QC]

Oh, that's too bad.

[The Chair, Liberal, Ken Hardie]

It's expired by a fair bit, actually. I've been very kind to you tonight.

Ms. Ashton, you have two and a half minutes.

[Niki Ashton, NDP, Churchill—Keewatinook Aski, MB]

First of all, while you were speaking, I did have a chance to do a cursory review of projects that have been approved by the AIIB over the last couple of years. I saw reference to water efficiency, the women's economic empowerment fund, emergency and crisis response facilities, the strengthening of vaccination and health systems under the COVID-19 strategic preparedness and response project, wind energy projects, urban transit and earthquake relief. They were in a range of countries around the world.

Those seem to be pretty important projects relating to life-and-death matters in some of the poorest countries in the world. Is this some of the work that, to your knowledge, the AIIB is involved with?

[Steven Kuhn]

Yes. Absolutely. I think as you and others look through that list of 178 projects that they've invested in to date....

I spoke earlier about the government's desire to engage in inclusive economic growth in the region as being a motivator for participating in the AIIB. I think your recital of that list from the website provides a clear articulation of some of the benefits of engaging in those projects, again, across 31 countries, in a region that has been identified as being a priority region for the Government of Canada's international engagement.

[Niki Ashton, NDP, Churchill—Keewatinook Aski, MB]

The question about the voting shares has come up on numerous occasions. Are the voting shares not in part related to the total subscriptions in the institution?

[Steven Kuhn]

I would say there are two elements to that answer. Absolutely yes, the amount of paid-in capital that members need to provide is in direct proportion to the voting power they have. But the fact of those voting shares is something that has been negotiated and is well known and transparent to all members.

[Niki Ashton, NDP, Churchill—Keewatinook Aski, MB]

Just to clarify, when we talk about China's voting shares, it's also a reflection of the significant subscription it holds compared with Canada, for example, with a much more reduced share.

Finally, you referenced—

[The Chair, Liberal, Ken Hardie]

I'm sorry, Ms. Ashton. Your time has expired.

[Niki Ashton, NDP, Churchill—Keewatinook Aski, MB]

Okay. That's fine.

Thank you.

[The Chair, Liberal, Ken Hardie]

I think we should be able to get back to you before we're finished here.

The next couple of speakers will be Mr. Seeback and Madame Lalonde. If we get to a third round, we'll have five minutes for the Conservatives, five minutes for the Liberals and two and a half minutes each for the Bloc and the NDP.

Mr. Seeback, the floor is yours for five minutes.

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

Thank you, Mr. Chair.

I'm going to go back to the Uyghur forced labour issue. Mr. Oliphant pointed out that it was an American list. Yes, it is because we don't have a list in Canada of banned entities. Despite the United States doing diligent research, Canada has not done any, so we don't have a list. However, we do know that Canada is legally obligated under CUSMA to not allow for the importation of goods made with forced labour. You're aware of that. Is that correct?

[Steven Kuhn]

My mandate does not include CUSMA specifically, so, no, I'm not aware of that.

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

Okay. Well, that is what we are legally obligated to do: to not allow for the importation of goods made with forced labour. That's the law in Canada.

Canada has not seized a single shipment of goods coming from the Xinjiang region of China, or anywhere else. In fact, the United States is now urging Canada to stop the importation of goods made with forced labour because we have become a dumping ground for those goods after the United States banned it. That takes me back to the question of the AIIB.

Do we have any protocols in place to ensure that companies that use Uyghur forced labour don't get financing from the AIIB?

[Steven Kuhn]

As a multilateral institution, Canada participates on the board of directors of the institution as one of.... We're not on the board of directors at the moment. However, when we were on the board of directors, before the pause started, we were a voting member that made decisions with respect to projects the institution proceeded with, but we were only one voting member.

The vote share across the institution is such that Canada does not have a veto on particular projects that are approved by the institution, much as it doesn't have a veto at any multilateral development banks at which we're members.

While we can raise issues, and we can attempt to find like-minded partners at the board table who can also raise issues with us, we do not have the vote share necessary to block individual projects ourselves.

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

We don't know if funds used at the AIIB have been used by companies accused of using Uyghur forced labour. We don't have a system in place to look into that.

[Steven Kuhn]

I am aware that there are instances of projects that have been approved by the AIIB where Canada and other partners around the board have raised questions about forced labour and where Canada's engagement has not allowed for those projects to be blocked as a result of that.

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

Those projects went ahead then.

[Steven Kuhn]

Yes.

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

Because we're an investor in this, a shareholder in this bank with Canadian taxpayer dollars, then we can conclusively say that Canadian taxpayer dollars, to some extent—it could be a very small amount—were used to finance projects where there was an accusation that a beneficiary of that financing was engaging in the use of Uyghur forced labour.

[Steven Kuhn]

What we can say is that we engage in a multilateral setting through that institution and that Canada does not have a veto on individual projects that are approved by the board of directors.

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

Those projects went ahead despite Canadian objections that there was potentially Uyghur forced labour.

[Steven Kuhn]

There are 178 projects on the website.