When it comes to China, size matters. It definitely matters. Consider that Chongqing, a metropolitan region most Canadians have never heard of, has a population of more than 30 million people, nearly equivalent to Canada's population. China has something like 100 cities with a population of two million people, or 100 cities the size of Montreal.
The education system in China is producing something like 200,000 engineers a year.
After a decade of double-digit growth, the Chinese economy is slowing down. It is still growing at $600 billion a year, nearly half the size of Canada's GDP.
Within another decade, China will surpass the United States as the world's largest economy.
Opportunities in China? "It's a massive, historic opportunity like none we've ever seen before," said Dominic Barton, the Canadian who leads McKinsey and Company's global consulting practice.
Barton was the opening keynote speaker at Canada and the Pacific Century, an important conference convened in Ottawa this week by the Canadian Council of Chief Executives.
China is by no means alone in putting up staggering numbers on population and economic growth. There's India, with 1.1 billion people. Mumbai, as Barton noted, will soon have a population of 35 million people, larger than Canada's.
"Don't think of Asia as countries, but as cities," Barton said. "City clusters."
In the information-technology space, companies such as IBM have more than 100,000 employees in India working for clients in North America and Europe. The Indian government has invested in education, and one of its comparative advantages is one of the most literate workforces in the world.
China and India alone have 2.5 billion people. This is a significant opportunity for Canada to diversify its international trade beyond the U.S., which now accounts for three-quarters of our exports, including 99 per cent of our oil and gas exports. China, for all its growth, accounts for only three per cent of Canada's exports.
As John Manley, CEO of the business council, put it in an interview in Policy Options: "For a CEO looking at where the world is going to be in 20 or 30 years, it's vital to understand the impact of the Pacific Century on their markets, their suppliers and their customers."
So, to borrow from Sir Wilfrid Laurier, will the 21st century belong to Canada? Manley hears a lot about Asia from his members. And as Barton noted: "There's been a noticeable pivot in the last couple of years."
But if critical mass matters in China, so does engagement. In a country where things are measured in decades, if not centuries, relationships matter.
But as Barton also noted: "We have a lot of what the world needs."
Asia will need a lot of energy, and a lot of food.
China has already invested $15 billion in the Canadian oilpatch, and if the $15-billion Chinese acquisition of Nexen is approved, that will double.
This is by no means a done deal. If it is approved by Investment Canada, it's far from clear that the Chinese would grant reciprocity to Canadian companies.
And Canadians are themselves conflicted on energy. An Ipsos poll taken for the Ottawa conference shows that nine Canadians in 10 think we should diversify our energy markets beyond the U.S., but three Canadians in four are concerned about losing ownership of the resource.
In other words, Canadians want to trade with China, but not be owned by them.
To say nothing of the challenges of getting oil to Asian markets.
The most efficient way to transport crude is by pipeline from the Alberta oilsands to the West Coast. But as the controversial Enbridge Northern Gateway project demonstrates, there are serious issues involving the environment and aboriginal nations, some 55 of them along the proposed route to northern B.C.
And then on food, does Canada have a comparative advantage with China in the sense that memory matters?
It was John Diefenbaker as prime minister who opened the door to communist China with wheat exports in 1961. This was nearly a decade before Pierre Trudeau recognized China in 1970.
Journalist Tom Clark, posted to Beijing in the early 1980s, recalls that two decades later, Dief's agriculture minister, Alvin Hamilton, was treated reverentially on a business trip to China. As Clark recalls his translator saying: "He fed us."
L. Ian MacDonald is a Montreal Gazette columnist.
