British Columbia must make better use of its immigrant population’s ties to Asia if it wants to keep pace in the race for business with China and other emerging markets, say business leaders and politicians.

Even though almost a third of British Columbians have family ties to Asia, speakers and delegates at the recent Asia-Pacific Summit in Vancouver contended that B.C. is underperforming in the world’s fastest-growing marketplace – China.

“Let’s see how we’re using them, using those connections and why we are still not achieving more,” said David Fung, chairman and CEO of ACDEG Group. The Vancouver firm – whose interests include research and development, manufacturing, distribution and capital investment – does most of its business overseas.

Many federal and provincial politicians, business leaders and academics agreed B.C. and the rest of Canada are losing out in the quest for business with China, India and other countries, even though 22 per cent of B.C. residents are of Asian descent.

Don Denton, Business Edge
Sikh farm workers harvest the last of the season’s pumpkins at Michell Farms on the Saanich Peninsula just outside of Victoria.

While Premier Gordon Campbell and others touted a bevy of business opportunities available between B.C. and Asian countries, other conference speakers and delegates said Canada’s private and public sectors need to do more to spur activity.

Fung, who is also chairman of the international trade committee of the Canadian Manufacturers and Exporters in B.C., said the province’s failure to capitalize on its immigrants’ connections will spell a lower share of wealth and a decline in living standards.

He said Asia-Pacific is essential to diversifying B.C.’s trade revenues.

“If you put all your eggs in one basket and the U.S. sneezes, then you get a cold,” said Fung. “Of course, the U.S. will always be our biggest market. But at the same time, if we are not as reliant on the United States, then it will reduce the impact of a U.S. economic slump on the Canadian economy.”

Several conference participants called on the federal government to make it easier for business operators and skilled workers from Asia to get into Canada, but Fung said B.C. firms are not looking for a more liberalized immigration policy.

“I think it’s more a case of how do we digest, if I can use that word, immigrants coming into Canada to ensure we make best use of their potential,” said Fung. “In terms of immigration in Canada, I think businesses will use immigrants who are qualified.

“But then provincial regulations and legislation currently are giving those self-regulatory bodies the ability to regulate, which is important for public safety purposes. At the same time, we wonder whether sometimes that is done a bit overboard.”

But Fung said allowing more immigrants into Canada is not necessarily the answer.

“You’ve got 30 per cent in this province and we still don’t see a visible, distinguished achievement,” said Fung. “Well, what’s the point of having 50 per cent? So I think we’ve got to re-examine what we’re doing with our immigrants and what are the reasons why we are underperforming.”

Fung said B.C. firms also have to do a better job of working with locals of Asian origin. He noted that most companies do not have immigrants in top management positions.

Daniel Muzyka, dean of UBC’s Sauder School of Business, said B.C. has always had a strong relationship with Asia, but it can do better. B.C. has not been as effective as it could be in developing a brand that appeals to Asian businesses, or providing some of the opportunities that immigrants expected, he said.

“Maybe we’ve got to revisit this again and ask ourselves: ‘You know, we have shortages of professionals in some areas. Are we fully utilizing these professionals, or are we just trying to close markets?’” Muzyka said.

He added that B.C. must be “a whole lot better” at using its existing network of individuals and their contacts in the larger immigrant population.

“It’s not current immigrants, but first-, second-generation,” said Muzyka. “From the statistics, we haven’t been very good at leveraging that opportunity.

“There’s natural linkages for these individuals to their countries of origin, their parents’ countries of origin and the like, and that natural network is something that should generate more economic development, more economic share for us in that part of the world – but it’s not delivering that.”

Muzyka said there is more of a sense of urgency to develop closer relations now, as opportunity shifts away from traditional trading partners in Europe and in North America.

Because of its growing markets and appetite for consumer goods, Asia and the Pacific will be the growth engines of the world for the next 20 or 30 years.

“If we’re going to play as a country and want to preserve our lifestyle and continue to grow – and we are a heavily export-driven economy – that’s where we’ve got to be,” said Muzyka.

Federal International Trade Minister Jim Peterson indicated he would take conference-goers’ concerns about Asian access to B.C. back to his department.

Peterson also announced that International Trade Canada is launching roundtable discussions on Asia with businesses, academics, the B.C. government, other provinces and other stakeholders.

Peterson called on business leaders to help him develop regional and sectoral strategies to exploit emerging markets.

“I think we’ve all been too slow,” said Peterson. “Now, we’re going to make up for lost ground. We’re going to be aggressive in pursuing these new opportunities.”

While watching its economy expand 40 per cent in the last four years, China has become Canada’s second-largest trading partner behind the U.S. But China accounts for just over one per cent of Canadian exports and India accounts for only 0.2 per cent.

According to Campbell, 24 per cent of B.C. exports go to Asia-Pacific countries, while only five per cent of exports from other provinces head there.

Although China has replaced the U.S. as the world’s top destination for foreign investment, attracting $53.5 billion US, Canada invested only $542 million – or 0.1 per cent of its total outward investment – in China last year.

Meanwhile, Canadian direct investment in India amounted to a modest $184 million in 2003, while Indian investment in Canada reached about $62 million.

Peterson and business leaders said Canadian companies have paid less attention to Asia because it has been too easy to do business with the U.S., which is Canada’s largest trading partner.

Because of Canada’s distance from Asia and the size of the American market, there was no incentive to do business in the Far East.

The trade minister said it’s critical for Canada to become part of China’s global supply chain.

But he added the biggest stumbling block facing B.C. and other Canadian firms is their lack of knowledge of Asian markets.

“People have not made the effort to go into them,” said Peterson. “We just assume Canadians who have invested the time over the years to make the connections in a country like China are doing very well.”

Kam Rathee, executive director of the Canada-India Business Council, praised Peterson’s plan to hold roundtable discussions.

“It’s about time,” said Rathee. “I think that’s the only way we can probably move ahead in promoting trade and business with other countries, notably India.”

Rathee said the problems, complaints and concerns that Canadian businesses face when dealing with Asia are “all over the map,” so the process of bringing everything in one place will be beneficial to everyone involved.

He also called on Ottawa to provide funding for his Toronto-based organization and other agencies that promote Canada-Asia trade. Of the Canada-India Business Council’s 86 member companies, 22 are based in B.C.

“We’re a non-profit agency – we cannot survive simply on membership,” said Rathee. “We need the government support . . . I’m not saying give us a handout. Give us projects, give us things to do and we’ll do that on payment of services and fees.

“It’s agencies like us . . . who are the actual conduits, the catalysts, the leverage agencies that do these things.”

Rathee said there is a lack of communication between business-oriented federal ministries and the immigration ministry.

“One thing they’re forgetting: The people who come from these countries are not your everyday, Joe Blow people,” said Rathee. “They’re actually business people. They’re upstanding, they have the reputation, they have the money – everything they have got to have to settle in and do business.”

Patrick Julien, president of Caelis International, a South Delta-based information and communications technology company that sets up online learning, e-commerce, networks and other services in Asian countries, noted Ottawa has different rules for foreign nationals from different countries.

Julien said his company needs to bring overseas employees to B.C. on temporary work visas because of a lack of Internet infrastructure and the high courier and phone costs in overseas countries – but faces big obstacles from immigration officials.

Caelis recently lost what it calls a lucrative prospect when one woman, as knowledgeable of the operation as the company’s principals, was denied entry, said Julien.

“It’s difficult for us to rationalize having to accept losing, in our case, about $1.7 million US over the next five years, and essentially having a very strong say on the disposal of a procurement envelope of $50-$60 million,” said Julien, adding several federal government departments had provided letters of recommendation for the woman’s visa application.

“They said she lied on her application – which was not the case,” said Julien. “There was no real reason given.”

John Les, B.C.’s small business and economic development minister, said the province will continue to press its immigration concerns with Ottawa.

He said B.C. needs educated and skilled immigrants to develop its rapidly growing economy.

“We need to utilize some of the existing programs more effectively and it’s also true, I think, to say that we need to lobby the federal government to ensure that we have more access to immigration, generally, across the board,” said Les.

In an exuberant, campaign-style speech at the trade conference, Campbell vowed that B.C. will become a “magnifying glass” to opportunities in Asia-Pacific. As part of its soon-to-be unveiled B.C. Rail bill, the province will spend $4 million on Asia-Pacific business development.

“We are going to invest to build stronger ties with Asia-Pacific,” said Campbell.

(Monte Stewart can be reached at monte@businessedge.ca)