Canada should be ready for a growing inflow of Chinese investment over the next few years. That is one message from a survey released on Tuesday by the Asia Pacific Foundation of Canada (APFC).
The survey found that Canada is near the top, just after the United States, of the list of overseas investment targets for Chinese companies. The third target country is Australia.
The survey, "China Goes Global 2009," polled 1,100 Chinese companies, and found that one of the key attractions of Canada is its openness to Chinese investment, especially compared with countries in Western Europe.
Amongst the key findings:
-- Chinese companies are most interested in Canada's energy and natural resources, agri-food and biotech sectors;
-- Although only 7 percent of the companies surveyed have investments in Canada, an impressive three-quarters of those already here say they are considering further investment within the next few years;
-- One of the attractions of Canada is its position within NAFTA. The majority of companies that have invested in Canada are looking to service the entire NAFTA market. Only 25 percent said their planned investment was to service the Canadian market alone.
Commenting on the survey results, Yuen Pau Woo, president and CEO of the Asia Pacific Foundation said the message is that Canada should be ready to deal with the "new China."
"We have to be prepared because Global China is coming. This is not the China that has been filling Walmart's shelves with low-cost manufactured goods. This is the canny and self-confident China that has spent several billion dollars in the past few months alone buying into Teck Resources Ltd. and Athabasca Oil Sands Corp.," said Woo.
The survey found that among the biggest concerns Chinese firms have in considering investment in Canada is the unfamiliarity of Chinese brands in this country, as well as their own lack of understanding of legal and market risks in Canada. Among their least concerns is a negative reaction from the Canadian public or government to greater Chinese investment. The survey was prepared by the Asia Pacific Foundation of Canada in partnership with The China Council for the Promotion of International Trade (CCPIT).
The survey results are based on a sample of Chinese firms which are members of CCPIT, which have been involved in international business, and have annual revenue exceeding RMB 1 million (146,000U.S. dollars). The response rate to the survey was 46 percent, producing 1,104 valid responses during the period December, 2008February, 2009.