Questions over Chinese purchases of Canadian assets

VANCOUVER •No nursing home wants to be known for uncertainty and intrigue. So a Canadian retirement home chain found itself in an uncomfortable position last year when it agreed to be bought by a politically connected Chinese firm with a shadowy group of owners.

The deal was approved, even though the buyer was under regulatory scrutiny in the United States.

Today, the chairman of the Chinese buyer, Anbang Insurance Group, is being held by the Chinese police for undisclosed reasons - and critics say the deal represents the latest example of Canada's troublingly lax attitude towards Chinese money flooding into the country to snap up assets.

"When the Anbang house of cards finally collapses, who will gain control of these senior care facilities in BC?" Mr Mark Strahl, a lawmaker with Canada's opposition Conservative Party, asked in Parliament last month, referring to the province of British Columbia.

"Are seniors about to find out that their landlord is actually the People's Republic of China?"

Canada, like the US and other countries, is grappling with how to handle billions of dollars of Chinese purchases on its home turf, including big oil companies, deluxe office buildings and cutting-edge tech firms. That last set, in particular, has raised objections in the US and Canada from those worried they could give China access to sensitive technologies.

Economically, China and Canada have grown close. The value of Chinese direct investments in Canada increased nearly fivefold between 2007 and 2015. Chinese buyers have struck nearly US$43 billion (S$59 billion) in Canadian deals over the last seven years.

But that closeness has caused tensions. Many Canadians blame Chinese money for soaring home prices in places like Vancouver, and perceive a softening of Canadian positions on topics like human rights. At a news conference last year, China's foreign minister rebuked a Canadian journalist for asking a question about human rights while then Canada's foreign minister Stephane Dion stood silently by.

While US officials have rejected a growing number of Chinese deals, rejections in Canada are rare. Its takeover panel has rejected only two deals since 1985, while more than 1,700 transactions have been approved.

NYTIMES

A version of this article appeared in the print edition of The Straits Times on July 13, 2017, with the headline 'Questions over Chinese purchases of Canadian assets'. Print Edition | Subscribe