Prime Minister Justin Trudeau and Australian Prime Minister Anthony Albanese attend a meeting during a NATO leaders summit in Vilnius, Lithuania, on July 12.INTS KALNINS/Reuters
Prime Minister Justin Trudeau called for deeper ties with Australia on Tuesday, saying that, unlike authoritarian regimes, the country is a “like-minded partner” that is able to uphold democratic values while also supplying minerals that could help reduce global reliance on fossil fuels.
Mr. Trudeau refrained from using the term “friend-shoring,” which was popularized by United States Treasury Secretary Janet Yellen as a way of describing the idea of shifting trade to democratic allies that share a country’s own principles and beliefs. But his comments echoed the sentiment.
“Authoritarianism is on the rise, seeking to destabilize the peace and prosperity that generations have benefitted from,” he told the Australia-Canada Economic Leadership Forum, a regular gathering of political and business leaders from the two countries that is meeting in Toronto this week.
“More than ever, we need resilient supply chains, stable trading relationships, and strong ties with partners who align with us on values.”
Canada and Australia are both Commonwealth countries with Westminster parliamentary systems. Both countries are rich in resources and attract hundreds of thousands of immigrants each year. And, as Mr. Trudeau noted, both are trying to repair relations with Indigenous people.
“The world is a scary place. And in this critical moment we need to ask ourselves: Who really is best positioned to succeed?” Mr. Trudeau said. “Those who exploit workers? Those who pollute? The authoritarians who power their economies by indebting emerging economies?”
Mr. Trudeau didn’t name the countries he believes are bad actors. His mention of indebting emerging economies could have been a reference to China’s Belt and Road Initiative, which has been accused of ensnaring smaller nations in debt and then taking control of their infrastructure for Beijing’s own strategic purposes.
“When you buy Canadian or Australian you can count on the high standards we maintain at home – and that’s not a disadvantage, that’s now our competitive edge,” he said.
“In order to build a robust clean economy with great jobs, we need to work with like-minded partners who see the same opportunities in this future as we do,” he added.
Critical minerals, such as lithium and cobalt, are considered key to transitioning to a cleaner economy because of their uses in electric vehicle batteries and other new energy technologies. Australia and Canada have both sought to build up mining industries as alternatives to China, a major source of many critical minerals.
Goldy Hyder, president of the Business Council of Canada, told the event that Canada still needs to streamline approvals for resource projects at home. “What we would like to see is one project, one review. It would be so much easier if the federal government and provincial governments would agree for mutual recognition” of each other’s reviews, he said. “With respect, 12 to 14 years is too long to get a permit to do a mine.”
Australia is Canada’s 17th-largest export market, according to the Department of Global Affairs. Direct investment in Australia from Canada has grown more than 43 per cent in recent years, to $57.9-billion in 2022 from $40.3-billion in 2018. Australian direct investment in Canada has more than doubled to $24.9-billion in 2022 from $11.8-billion in 2018.
Mark Dreyfus, Australia’s Attorney-General, told the event that the source of his country’s influence and credibility in the Indo-Pacific region “starts with who we are as Australians,” including the multicultural society it has in common with Canada, and its relationship with Indigenous peoples.
He noted that Australia is preparing for a referendum later this year on whether its citizens support altering its constitution to include a “Voice to Parliament,” an Indigenous committee that would advise the country’s Parliament on matters affecting Australia’s Aboriginal and Torres Strait Island people.
In May, The Globe and Mail reported that Canada is seeking to join the non-nuclear component of AUKUS, a security pact between Australia, Britain and the United States that was struck to counter China’s rising military might in the Indo-Pacific region. This non-nuclear part of AUKUS provides for information sharing and close co-operation on accelerating development of cutting-edge technologies, including artificial intelligence, quantum technology and hypersonic warfare.
Jennifer Westacott, chief executive of the Business Council of Australia, told the event that AUKUS is a “game-changing deal that rewrites power dynamics and opens up a new set of broader economic opportunities.”
“Our view is that we don’t want to see Canada excluded from these benefits,” she said.
She noted a recent Ernst & Young survey that found that nearly nine out of 10 chief executive officers say they are “focused on markets where their home country has strong geopolitical and economic relationships.”
Ms. Westacott said the U.S. Inflation Reduction Act, which offers subsidies for clean energy, “is acting as a massive magnet for investment.” But, she predicted, Australia and Canada “may struggle to attract the level of capital we need.”
As a result, she said, Canberra and Ottawa need to work together to improve their regulatory environments, and develop their carbon pricing and carbon markets, their environmental protection policies and their ways of working alongside decarbonization.
Mr. Hyder said the Canadian government, which is spending billions of dollars on the shift to clean energy, should still be devoting money to helping fossil fuel technology such as liquefied natural gas – which can be used to displace coal – and he faulted Ottawa for declining to do so.
“They genuinely believe that they’re doing us all a favour, to just go all in on the transition,” he said of the Trudeau government. “Because they think that if we also invest in the fossil fuel industry, particularly LNG and others, that that will be capital not available to funding the transition. It’s an ideological divide.”
“I disagree with that,” Mr. Hyder said. “Because the truth is you need to do both.”
With a report from Reuters