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‘Canada is only a big Caribbean country:’ Response from China expert

paul-evans-1By Douglas Todd From The Vancouver Sun

UBC planning professor emeritus Setty Pendakur, who has been to Mainland China 86 times to advise the government, was recently quoted in The Vancouver Sun saying “Canada is only a big Caribbean country,” given the many loopholes in its immigration and foreign money-transferring policies.

My piece on Pendakur’s views on Mainland China’s growth and its impact on Canada, especially the housing market in Metro Vancouver and Toronto, went viral.

Given the topicality, I obtained a response to Pendakur’s provocative views from another China expert, Paul Evans, who is a professor of Asian and Trans-Pacific international relations at UBC.

His most recent book is Engaging China: Myth, Aspiration and Strategy in Canadian Policy from Trudeau to Harper. He’s also co-author of the public white paper, “The Future of Canada’s Relationship with China.” (Institute for Research on Public Policy, November 2015).

chinese-tiger-dragonHere are Paul Evans’ (often measured) responses to some of what Pendakur had to say:

Q. Prof. Pendakur believes there are too many loopholes in Canadian immigration and investment policy, which makes it possible for foreign nationals to find a safe haven from taxation and their own governments while flooding the Canadian market with foreign money.

PAUL EVANS: The loop holes are gradually being closed.

But Professor Pendakur is right – that we need to address the problem openly. My sense is that it is not a China problem, but a Canadian regulatory problem.

In other jurisdictions, including where I {have recently been}, Singapore, there are firm and clear rules on disclosure, identification of ownership etcetera.

Q: What do you think of Prof. Pendakur’s belief that wealthy Mainland Chinese have discovered Metro Vancouver and are busy trying to invest their money here in housing, as a safe haven for their riches?

EVANS: Some have. Though Vancouver (and Canada) is just one place that Chinese families are looking to invest for purposes of security and financial return.

There are several global cities, including London, New York, San Francisco, Sydney and Singapore that are attractive for asset investment via residential property acquisition.

hqdefaultWhat distinguishes Vancouver is how many Chinese investors are also looking to live here for purposes of educating children, breathing cleaner air and enjoying a great urban life.

We are on the front line of “transnational” migration, of which buying property is just one part of a more complex set of motives and dreams.

Q. Prof. Pendakur is concerned about the number of “one-room” colleges and universities in Metro Vancouver, which often provide what he believes are inadequate educations to foreign nationals. Your thoughts?

EVANS: There are some, but my guess is that they are a very small part of the total educational scene. UBC, for example, has about 3,000 Peoples Republic of China international students.

{Pendakur} is right that there is need for closer regulation and standards in accrediting educational institutions, including as protection for overseas students and their families.

Q. Prof. Pendakur would count Quebec’s immigrant investor program among Canada’s immigration loopholes. He would also favor taxing foreign ownership. What do you think?

I can’t offer a comment on the Quebec program, though I would be surprised if it also isn’t being reviewed.

To the best of my knowledge we don’t ask real estate purchasers from any country to disclose their sources of income.

The motives for the investor program were murky and the Conservative were right to scrap it. It never smelled right. Getting a new program in place should be a major part the government’s new China strategy….

I’m not certain that an investor tax is the right way to go, but this is a public policy issue that needs open debate and federal government leadership.

Q: What do you think about how China’s explosive growth is affecting Metro Van?

EVANS: On balance, {I think it’s} overwhelmingly positive from an economic, social and human exchange perspective.

China is crucial to the B.C. economy, though the composition of trade will shift as the Chinese economy restructures and service industries become more dynamic.

Q. Any other thoughts?

EVANS: Chinese investors are just one part of the story. The Chinese government would be pleased to see clearer regulations about disclosure of the offshore assets of its citizens. Here China is not alone – as we see with deepening U.S. governmental interest along the same lines.

University of B.C. China expert Paul Evans believes Canada is gradually closing the “loop holes” in its immigration policy. But he believes Professor Pendakur is right in saying Canadians need to address the regulatory problem more openly.
UBC planning professor emeritus Setty Pendakur, an expert on China, says “Canada is only a big Caribbean country,” given the many loopholes in its immigration policies. Another China specialist, Paul Evans, tends to agree, but offers some different perspectives.
“The Chinese government would be pleased to see clearer regulations about disclosure of the offshore assets of its citizens,” says Paul Evans. Can Canada help make that happen?

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