China trade minister to visit Canada; could mention CNOOC bid
OTTAWA, Sept 23 — Chinese Commerce Minister Chen Deming will visit Canada as Ottawa deliberates whether to approve a landmark US$15.1 billion (RM45.7 billion) takeover of oil producer Nexen Inc by state-owned Chinese oil company CNOOC Ltd.
CNOOC said it did not expect Chen to raise the sensitive takeover bid during talks with the Canadian government. Canada China Business Council president Peter Harder, however, said he would not be surprised if Chen mentioned it in a speech to his group on Tuesday.
Although Canada is seeking substantial foreign investment in its oil and gas industry, the CNOOC move is raising concern inside cabinet, where some members are wary of letting a Chinese state-owned enterprise buy up domestic assets.
Industry ministry officials are looking closely at the bid to determine whether it is of net benefit to Canada.
Separately, Canada’s spy service said some foreign state-owned enterprises could pose a threat to national security. It did not mention China by name.
Canadian Trade Minister Ed Fast gave little away when asked about a planned meeting with Chen in the next few days.
“I do expect it will be a productive meeting as we move the Canada-China relationship forward,” he told reporters on Friday.
Nexen — whose shareholders voted to accept the CNOOC deal on Thursday — said it was unaware of Chen’s visit.
A spokesman for CNOOC said it did not expect Chen and Fast to discuss the bid “because this is transaction between two commercial companies, not a government to government affair”. The Chinese embassy was not immediately available for comment.
China’s Ministry of Commerce is responsible for authorising investments of more than US$100 million by state-owned enterprises.
On the Canada China Business Council lunch in Toronto, Harder noted Chen had spoken about the CNOOC bid in a speech in Beijing.
“I think he would express the view that the transaction should be looked at as a business transaction and be seen on its merits and that China would hope that that would be the case,” Harder told Reuters in a phone interview.
He said that in Chen’s speech in Beijing, he had mentioned a foreign investment promotion and protection agreement Canada and China signed this month as well as China’s willingness to broaden economic relations between the two countries.
Canada says it needs C$630 billion (RM1.9 trillion) in investment in its energy sector over the next decade. It is also promoting the idea of oil sales to China.
Critics of the CNOOC deal point out that China is running a large trade surplus with Canada. They also complain Canadian natural resources companies find it hard to operate in China.
Canada’s spy service, in a report issued on Thursday, said some bids by state-owned enterprises to gain control off strategic sectors of the Canadian economy could threaten national security interests.
“The foreign entities might well exploit that control in an effort to facilitate illegal transfers of technology or to engage in other espionage and other foreign interference activities,” the Canadian Security Intelligence Service (CSIS) said.
“CSIS expects that national security concerns related to foreign investment in Canada will continue to materialise.”
Pressed about the report, Fast said Canada always took security into account when negotiating economic deals. “It would be our top priority to ensure Canada remains safe and secure,” he said.
Prime Minister Stephen Harper said last month that public opinion would play a role in determining whether to approve the bid or not.
The official opposition New Democratic Party says it is concerned about a Chinese state-owned firm buying what they call a strategic Canadian asset. Nexen controls less than 5 per cent of the crude-rich tar sands in the western province of Alberta, one of the world’s biggest oil deposits, where its Canadian properties are concentrated. — Reuters