Canada is still open to working with China after killing a massive planned takeover of Canadian construction company Aecon Group Inc. by Chinese interests, said Innovation Minister Navdeep Bains.
“I’m confident that we’ll continue to work together. We want to pursue strong economic ties with China and we’ll continue to engage them on a range of files,” Bains told a crowd at Algonquin College in Ottawa Thursday morning.
“We’re also very clear that we’re open for trade, we’re open for investment, but not at the expense of national security.”
On Wednesday, news broke that the federal government had blocked the $1.5 billion sale of Aecon to China’s CCCC International Holding Ltd., also known as CCCI, citing national security.
Canada has been pursuing free trade talks with China, but those conversations seem to have hit a wall. Prime Minister Justin Trudeau spent four days in China in December, but left without a formal commitment to moving the free trade talks past the exploratory phase into formal negotiations.
“We don’t want trade with China any which way, at any cost,” Trudeau told Reuters in an interview Thursday.
“We want the right kind of trade deals with China and dealing with security issues … should be and would be part of any mature relationship we try to establish with one of the world’s largest and growing economies.”
Stewart Beck, CEO of the Asia Pacific Foundation — an independent not-for-profit think tank on Canada/Asia relations — said the government’s decision could complicate future trade talks with China.
“It’s going to create some problems down the road in terms of negotiating a free trade agreement with the Chinese,” he said Wednesday night.
The potential takeover of the 141-year-old Canadian construction company by CCCI, a division of a Chinese state-owned company, was put on hold in February so the federal government could conduct a national security review of the deal.
Bains would not reveal what specific threats to Canada’s national security surfaced during the review.
“Under the Investment Canada Act, we have a very rigorous and robust process. We have a multi-step national security review process. That process was followed,” he said.
Opposition backs rejection
“I followed that advice, but at the same time we’ve been very clear that we are open to trade and investment but not at the expense of national security.”
Aecon’s stocks had tumbled almost 15 per cent by noon Thursday. The stock is now worth less than it was worth before CCCI offered to buy the company in October 2017.
Conservative MP Tony Clement welcomed the decision, but called for a review into whether other Chinese state-owned companies have bought Canadian assets.
NDP MP Brian Masse said he agrees with Ottawa’s rejection of the bid, but questioned why it took so long to come to a decision.
John Beck, president and CEO of Aecon, said the company is disappointed by the decision but “will continue to be a leading player in the Canadian construction and infrastructure market.”
Aecon has played a role in some of Canada’s most recognized projects, including the CN Tower, the St. Lawrence Seaway, Vancouver’s SkyTrain and the Montreal airport. As concerns were being expressed about the CCCI deal, Aecon withdrew from a group bid to build the Gordie Howe bridge, proposed between Detroit and Windsor, Ont. At the time, it cited financial reasons.