Government unveils ‘economic diplomacy’ initiative for foreign service

OTTAWA – The Harper government says it wants Canadian diplomats in foreign countries to re-channel their energies and resources into advancing the country’s commercial interests.

Trade Minister Ed Fast has laid out a new strategic direction for Canada’s foreign service called “economic diplomacy,” a plan that’s designed to put commerce at the heart of foreign policy.

The objective is to improve Canada’s lacklustre trade and investment performance in emerging markets, which the government and the Bank of Canada have identified as key to the country’s future prosperity.

Fast, who played a major role in the Canada-European Union trade negotiations, outlined the policy Wednesday in a speech to the Economic Club, describing it as a sea change in the way diplomatic resources are deployed around the world.

“We’re simply talking about finding the appropriate balance … making sure Canada remains on the forefront of delivering development to a world that desperately needs it, and at the same time making sure our diplomatic assets are deployed in a way that drives our economic interests,” he said.

“Those are not mutually exclusive … they can be married in a way that can add value to the money that Canadians spend in field.”

Fast said the change would entrench the concept of commercial success for Canadian firms and investors as one of the core objectives for the foreign service.

But NDP foreign affairs critic Paul Dewar said the Harper government is doing the country a disservice with its “single-minded” approach to foreign policy.

Dewar said the government is not getting results for businesses and is turning the country into a non-player around the world. Canada’s foreign service has been cut back in recent years, he added.

“They don’t understand that in order to succeed in trade, you have to have robust diplomacy, robust engagement and show that you are there to bring something to the table other than just your own economic self-interest.”

Fast, however, dismissed the criticism and said the foreign service would be engaged across the wide spectrum of issues. He also insisted that human rights would continue to play a key role in Canadian foreign policy.

The strategy has clear objectives: within five years, Fast said, he wants to come close to doubling the 11,000 or so small and medium-sized Canadian firms that currently operate in emerging markets such as China, India and Brazil.

If the strategy is successful, it would create upwards of 40,000 new export-oriented jobs, he added.

Canadian Council of Chief Executives head John Manley welcomed the announcement, noting that one in five Canadian jobs are linked to exports. He said the new strategy will help Canadian companies find new opportunities.

It remains unclear how the new strategy would work — whether Ottawa would increase its diplomatic footprint in designated countries or boost spending on the effort.

Fast refused to say whether the foreign service will be beefed up, or whether existing manpower will be shuffled around to concentrate on the new priority.

The government has in the past signalled its intent to advance commerce as a key function of the diplomatic corps. It has already melded the trade and foreign affairs functions under a single department and announced plans to fold in the Canadian International Development Agency.

The approach builds on Ottawa’s Global Commerce Strategy unveiled five years ago and comes after a year-long consultation with provinces and businesses on how Canada should harness its resources to make a bigger dent in the parts of the world that are growing the fastest, such as Asia and parts of Latin America.

That was the objective when Ottawa announced its commerce strategy in 2007, and part of the approach entailed aggressively seeking new free-trade agreements where possible.

Ironically, however, Ottawa’s only successful major trade negotiation since has been with Europe, a developed common market with painfully slow growth.

Meanwhile, analysts have warned that Canada is falling behind, rather than gaining, in terms of market share in many emerging regions.

Along with refocusing foreign diplomatic assets, Fast said the government will try to identify specific nations and sectors with the greatest potential for Canadian firms in terms of export and investment opportunities.