Trudeau Liberals face warnings on Chinese bid for Aecon

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The Trudeau government’s enthusiastic remarks about building business ties with China could put the country’s relationship with the Trump administration at risk

Despite proceeding with caution and transparency, Trudeau Liberals are still receiving warnings as they review a Chinese state-owned company’s bid to purchase Aecon Group, Inc. for $1.5 billion.

The warnings came as the Liberal government assured China that Canada’s pursuit of building a deeper trade relationship with them is “full steam ahead.” Many were worried that the fed’s statement could potentially anger the Trump administration and put the North American Free Trade renegotiations at risk.

China’s CCCC International Holding Ltd. placed the bid Nov. 2. Under the Investment Canada Act, the deal required Ottawa’s approval, which will be given after passing a thorough review process. Prime Minister Justin Trudeau previously said the government will look “carefully at security issues” and “economic impacts” but has not made clear whether a national security test will be made on the company.

For eight years, the Chinese company had been suspended by the World Bank from bidding on construction projects due to its involvement in a bid-rigging scandal in the Philippines. They were also linked to the development of artificial islands in the South China Sea which created tension between China and other Asian countries.

Because of the company’s background, many urged the Liberals to keep their guards up. David Mulroney, a former ambassador of the country to China, suggested, “You have to show there are limits to our flexibility. We have real standards and we will live up to them.”

Paul Evans of the School of Public Policy and Global Affairs at the University of British Columbia also warned, “It’s going to be really important for the government to be both transparent and forthcoming on what are the calculations that lay beneath their decision on either national security or net benefit to Canada.”

As a response, the Chinese embassy in Ottawa argued that the acquisition is “purely a commercial activity” that would benefit the Canadian economy and that conducting a security review is a matter of “internal affairs.”

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