Asian dynamo’s stimulus package may create Canadian opportunities

Canadian industries could bene­fit from China’s massive econom­ic stimulation package, says the executive director of the Canada China Business Council.

China unveiled a $684-billion plan in November to boost its do­mestic economy, and spinoffs could mean jobs for Canadians, says Sarah Kutulakos.
“There are some good opportu­nities, and I think if you look at any of these countries that are putting together stimulus pack­ages, what they want are projects that will keep people working, the infrastructure shovel-ready pro­jects," Ms. Kutulakos said Mon­day. China has several of those projects and a reputation for get­ting projects started quickly.

Forty-five per cent of the stimu­lus package is earmarked for transportation work — high­ways, airports, bridges et cetera — and 25 per cent for reconstruct­ion after an earthquake. A power­ful quake struck central China in May, causing widespread damage in Sichuan province.

“So there is a lot of building go­ing on, and opportunities for Can­ada also include some core capa­bilities like rail, aerospace," she said.

Ms. Kutulakos, in Halifax for a Worldsourcing conference, said some the contracts may not be di­rectly with the Chinese govern­ment but with Chinese compa­nies who hold the main contracts. Ms. Kutulakos said there are al­so opportunities in outsourc­ing. China’s goal is to put itself in the same position as India, which has been successful in providing services, including in the area of Internet technology.

“We have been seeing it more and more as a council over the last couple of years. Shenzhen (city), for instance, came in with a specific outsourcing delegation. They don’t want to be in toys and low-cost electronics anymore; they want to be in the higher-val­ue things.

“It all relates back to the coun­try’s five-year plan of trying to promote things like scientific de­velopment, and when the Chinese government says it wants to do something, it usually puts its money where its mouth is," she said.

Canadian companies should be ready to get into China, but she urged investors not to be in a hur­ry in making initial decisions.

“We advise companies not to go too quickly. . . . Don’t make rash decisions about which compa­nies you choose or which deal you should make. The Chinese very much value understanding you, and it is important that you un­derstand your potential part­ners," she said. It may also be of benefit not to look at China as a whole because it is so vast. What a Canadian company has to offer may be more beneficial to a specific re­gion, which may be more open to Canadian technology and capa­bilities.

Ms. Kutulakos said Canadian firms should be prepared to spend money to make money. The cost of doing business in China is not low, “but the potential profits to be made are significant."

Nova Scotia interests have made business inroads in China. Angus MacIsaac, Nova Scotia’s minister responsible for Atlantic Gateway, is in China leading a business development mission that includes Stephen Lund, pres­ident and CEO of Nova Scotia Business Inc., and Paul Boutilier, managing director, Atlantic Gateway business development.

“The purpose of this visit is to continue to build on our efforts to develop business and keep our fo­cus on relationships that can lead to opportunities key to our econo­my and the Atlantic region as a major trade portal," said NSBI spokeswoman Sarah Levy. “It’s important for market exposure and for gaining valuable insight into international markets, like China," she said.

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