Harper arrives at Asia-Pacific summit bearing $36B Malaysian investment boost - Macleans.ca
 

Harper arrives at Asia-Pacific summit bearing $36B Malaysian investment boost


 

NUSA DUA, Indonesia – Prime Minister Stephen Harper arrived in Bali for an Asia-Pacific leaders’ summit Sunday bearing what could be called a $36-billion vote of confidence from Malaysia’s state-owned oil and gas company.

Malaysian Prime Minister Mohd Najib sprung the “gargantuan” investment figure during a joint availability with Harper in Putrajaya, saying Malaysia’s state-owned oil and gas company Petronas has committed to construction of a liquid natural gas plant in British Columbia and the pipeline to feed it.

“I’m told that this is the largest direct foreign investment in Canada by any country,” Najib said, flanked by Harper following a formal welcoming ceremony at a sprawling new government precinct outside the Malaysian capital of Kuala Lumpur.

Najib called it a “significant landmark decision” by Petronas, which last year spent more than $5 billion buying Alberta-based Progress Energy Inc.

The Petronas takeover, and a bigger oil patch buyout by China’s state-owned CNOOC, prompted months of hand-wringing by the Harper government. It approved the deals late last year but at the same time introduced new rules that permit majority takeovers of Canadian companies by state-owned enterprises only in the most exceptional circumstances.

The policy change put a major chill on direct foreign investment in Canada by so-called SOEs, and analysts have recently begun questioning whether the Conservative policy shift is scaring off much-needed foreign capital.

Najib rode to Harper’s defence Sunday, calling the promised Petronas infrastructure investment a testament “to the level of confidence we have in the policies of the Canadian government.”

Harper’s reaction to the news was almost muted, by contrast.

“Look, we view the Petronas investments very positively and all the indications I have is that Petronas is looking at further investment,” said the prime minister.

“The government of Canada is very excited about that possibility, as are all those I’ve talked to in the energy sector.”

However the Prime Minister’s Office declined to provide any details of the promised $36 billion investment, referring reporters to Petronas for details. Provincial officials in B.C. had spoken in June of a $19 billion LNG plant and pipeline investment by Petronas, and it wasn’t clear Sunday where the whopping new total comes from.

Both Najib and Harper flew their separate delegations to Indonesia following the Sunday morning meeting in Malaysia.

Regardless, the announcement provides Harper a much-needed shot in the arm as he brings Canada’s trade and investment message to Bali.

Harper has been involved in an increasingly acrimonious and very public tussle with U.S. President Barack Obama over the proposed Keystone XL pipeline to take Alberta bitumen south, and is meeting stiff resistance within Canada to the proposed Northern Gateway pipeline to the B.C. coast.

The Conservatives have also failed to seal the major trade pacts they’ve been negotiating, and Najib appeared to confirm Sunday that the proposed Trans-Pacific Partnership, involving 12 Pacific Rim counties including Canada, won’t meet its year-end target for completing a framework agreement.

So Harper, who has prorogued parliament and will deliver a throne speech Oct. 16 setting out a new government agenda, needs some good economic news to bolster his case.

Najib was asked by a Malaysian reporter what guarantees Petronas had been given on its multi-billion-dollar Canadian investment “over 30 years.”

The investment has a long horizon, Najib agreed, adding he is confident that not only the current Conservative government would support Petronas’s Canadian involvement, but so would future governments.

Harper, who has never shied from throwing partisan jabs while representing Canada abroad, took the opportunity to take a swipe at both the Liberals and the NDP. He said Liberals have always approved any foreign investment “no matter what,” and that New Democrats “are ideologically opposed to investment.”

Harper said his government judges each foreign investment “on its merits” and called it a policy of “discretion.”

It’s a fine balance for a Conservative government that says it is courting Asian markets and wants to make Canada an “emerging energy super power” but has faced a backlash from its political base over foreign — especially Communist Chinese — state-owned enterprise takeovers.

The policy shift has not been welcomed in China, noted analyst Yuen Pau Woo, president of the Asia Pacific Foundation of Canada.

Malaysia, which has few state-owned enterprises, won’t much mind, Woo said in an interview — “they’re in the barn already” — but China has a host of state-owned companies looking to expand and Canada is not sending welcoming signals.

Harper said all western governments have some tough choices to make but that Canada is well positioned.

“Look, it’s no international secret that the rise of China and of Asia in the minds of all of us is likely to be one of the dominant realities of the coming century,” Harper said Sunday.

“Western countries certainly will have their place in the world — provided that we make good decisions.”

He said Canada must “avoid some of the pitfalls of other western countries,” without citing any foreign examples.

Budgetary and political gridlock in Washington has shut down the U.S. government and will prevent President Obama from attending the APEC summit here.

Najib graciously offered that Asia’s rise will be a global boon “and we believe that we should prosper together.”


 
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Harper arrives at Asia-Pacific summit bearing $36B Malaysian investment boost

  1. Another example of real leadership vs primping at paid speaking tours. Adult leadership in action.

    • Actually Canada needs trade unless you plan on learning how to grow your own rice and food in the snow.

  2. While we import a lot from this region, other than oil and select resources we don’t ship much back as we are not a competitive economy. In fact, as a percentage of world trade, Canada has been shrining like the other J CU PIIIIGGGS in debt countries.

    We can’t compete as China investing int he Yangtze dam for cheap renewal electricity while we bailout out corrupt banks, GM, Air Canada and others and end up with no lasting value.

    We do it to ourselves, too much non-value added governemtn bloat kills our productivity, drives up the need for higher non-competitive wages…isn’t that we don’t make enough, it is that what we make doesn’t go very far because of governemtn bloat.

    Case in point, you earn $100, $40 to income and employment taxes, $10 to property/utility taxes, $20 to gasoline taxes for $30 of product. Yep, governments get 70% and you get 30% value. But if government taxed you half as much, you could lower the wage demands for more better competitive products and live better. And the $30 of real value, your probably used much of it to go to work to pay more taxes.

    Isn’t just gasoline, there is just from Ottawa, $40+ billion of hidden tariffs, duties, excise and hidden taxes you never hear of, GST/HST an provincial taxes extra. Even food poor eat, cloths poor buy are taxed. 284% tariff on mozzarella cheese is why you pay 3 or more times for cheese than Americans. Gotta get everyone with tax greed. Tax table creep too, you can make poverty wages and owe income/employment taxes.

    More hidden tax too is inflation that is higher than your RRSP, pensions, income raises are getting, a hidden compound devaluation tax on you even if you are on disability, retirement or even working that is all above the $40 billion above.

    You are economic slaves of state. Modern day taxation has become so pervasive, you are now salves to taxes and government bloat. And it is refusal to admit this that governemtn caused this depression by becoming larger than we could economically support.

  3. Every chunk of Canada gives to Communist China? China also takes the jobs. Harper’s Omnibus Bill gives China permission to sue Canada if, anyone tries to block China’s huge inroads into our country. China sued and took the 200 BC mining jobs from, the BC and Canadian miners. So, don’t be surprised if Malaysia also takes the jobs those jobs too. Harper handed the key to the oil sands to China, on China’s terms.