Selling Canada: FIPA and Canada’s Climate Future

Arielle Mayer

This past Sunday, over 310 000 people from around the world convened in New York City for the much anticipated “People’s Climate March”. The timing and location of the march was not random; two days later, over 125 world leaders – including United States President Barack Obama and British Prime Minister David Cameron – met in NYC for the United Nations Climate Summit. Noticeably absent from the meeting was Canadian Prime Minister Stephen Harper, who sent Environment Minister Leona Aglukkaq in his place. Critics of the federal government’s climate policy agenda have pointed to this as further proof that Harper “doesn’t care about climate.”

The Prime Minister’s absence from the UN Summit is particularly troubling given the federal government’s recent ratification of the Foreign Investment and Promotion Agreement (FIPA) with China. The sudden approval of the agreement came as a surprise to many, as it had been sitting non-ratified for over two years. The government has touted China as Canada’s second largest trade partner with a “two way bilateral merchandise trade totaling $73.2 billion in 2013.”

Yet a closer look reveals that this relationship is not exactly “two way.” When looking exclusively at trade revenue gained through investments, Chinese investments in Canada totalled $12 Billion in 2012, while Canadian investments in China totalled a mere $4.2 billion — and FIPA fails to eliminate barriers to foreign investment faced by Canadians trying to enter the Chinese market. In the oil and gas sector in Canada alone, China has thus far invested $30 Billion.

Federal Minister of International Trade Ed Fast has argued that “investment agreements provide the protection and confidence investors need to expand, grow and succeed abroad”, yet FIPA seems to only be providing “protection” and “confidence” to Chinese investors. Its benefit to Canadians in the long-run is undeniably suspect.

The agreement will, however, impact Canada’s climate policy agenda, as it stands directly in the way of any potential shift away from oil sands dependence. FIPA officially comes into effect on October 1, and will have a significant effect on the future development of the oil sands – and by association, climate, economic, and energy policies. Not only does the agreement lock Canada into a deal with China for the next 31 years, but it also allows Chinese investors to seek redress against laws passed by Canadian governments (federal, provincial, or municipal) that threaten their profits.

Significant investments include companies such as Nexen, Daylight Energy, and the Athabasca Oil Sands Corporation. With billions of dollars concentrated in the oil sands, Chinese investors will be looking out for their own best interests in steering the region’s future development – interests that largely disregard both environmental health and public opinion in Canada. In short, FIPA legally binds the management of a large part of Canada’s natural resources to the interests of foreign investors.

The ratification of FIPA has come as a blow to many non-governmental actors who want to see a shift in Canadian focus away from a further expansion of the oil sands. FIPA solidifies all investments in – and consequently the expansion of – the oil sands for the duration of the agreement. While some supporters have pointed to a clause in the terms of the agreement which outlines that it can be terminated with a year’s notice, existing investments must be given a 15 year grandfathering out period – meaning that the future of Canadian energy policy has been already been locked to the financial interests of Chinese investors in the long-term.

Canadians taking part in the “People’s Climate March” this past weekend – both the centerfold in New York City, and in smaller demonstrations held in Toronto and Montreal – were there to send a message to the federal government to address oil sands development in the context of a stable climate future. To date, it has been addressed solely in the context of expanding the economy – a lens that seems to be further solidified with FIPA.

An increasing number of Canadians are demanding to see the creation of safe and effective climate policies. In 2013, a poll conducted by L’Université de Montréal found that 84 per cent of Canadians believe that the federal government should take the lead on combating climate change. Torontonian, Sarah Sackville-Mclauchlan told the Toronto Star last week that she is attending the Climate March because “if we don’t do something now, the world will be unlivable in [her] lifetime.”

Yet this sense of urgency has not been reflected in Ottawa. By contrast, the signing of the Foreign Investment and Promotion Agreement shows that a very different policy direction is being pursued by the federal government – one that ignores both public opinion and potentially catastrophic environmental consequences in favour of passing power over Canada’s energy future to China.

Arielle Mayer is a 2016 Master of Public Policy candidate at the University of Toronto’s School of Public Policy and Governance. She previously completed a Bachelors degree in Political Science and English Literature at the University of British Columbia.

[IMAGE: Kris Krug; climate change activists hold up a sign during the 2009 United Nations Climate Change Conference in Copenhagen, Denmark).

One response to “Selling Canada: FIPA and Canada’s Climate Future

  1. Pingback: China-Canada FIPA casts shadow over future of climate | Vancouver Observer | Enjeux énergies et environnement·

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s