Is Canada a Credible Partner in the Indo-Pacific?

Stephen Nagy

Stephen Nagy returns to discuss Canada’s latest defence policy update and its implications for regional security and engagement. He also analyzes the effectiveness of the Indo-Pacific strategy over a year since its release, strategic autonomy in Southeast Asia, regional security dynamics, the compatibility of FOIP and BRI, and the hedging strategies of Southeast Asian countries amid great power competition between the U.S. and China in the region.

What do the security dynamics look like in the region we call the “Indo-Pacific” right now? Especially within the context of Great Power competition between the U.S. and China.

At the macro level, what we see is what the Ukrainian ambassador in Japan calls the “cartel of chaos” – China, Russia, Iran, North Korea, and Hamas. They are interested in rewriting the software of our international order and international institutions, where concepts that we see as underpinning the rules-based order move away from a Western-centric or U.S.-centric worldview. They want to do this because they want international institutions to be safer for authoritarian regimes. They do not want international institutions to be able to interfere in their domestic environments and deal with the serious human rights challenges that exist in the five entities I mentioned.

That is at the macro level. Then, when we pivot to the Indo-Pacific, there’s security challenges that range from the Himalayan plateau where the Chinese and Indians are fighting over territory. That is one area we should be concerned about.

The South China Sea is a cauldron of instability. Right now, China is being very assertive towards the Philippines, shooting water cannons at fishing vessels and preventing the refueling and delivery of food and other resources to Filipinos in the South China Sea. The Vietnamese and Chinese still have problems as well. Remember, the South China Sea has about 5.5 trillion U.S. dollars of trade that goes in and out of the region. That is more than the entire economies of Japan and Canada put together.

We have the Taiwan Strait, where just last week after the inauguration of President Lai, the Chinese military had drills in and around Taiwan to demonstrate that they could potentially engage in a blockade. The Chinese use lawfare and gray zone tactics in and around the Senkaku Islands to try and delegitimatize Japanese sovereignty over them and the northern territories of Japan.

Finally, you’ve also got North Korea’s WMD proliferation and more coordination between North Korea and Russia on the Ukraine front.

You’ve written a chapter called Southeast Asia’s Indo-Pacific Context in your new co-edited volume, Southeast Asia and the Indo-Pacific Construct, chapter one. You reference FOIP and BRI, which are hedging strategies to secure strategic autonomy. For new readers could you describe the terms FOIP and BRI, and what a hedging strategy is in this context?

Under the late Prime Minister Abe, Japan started the Free and Open Indo-Pacific (FOIP) strategy or vision, now called a plan. It was an initiative to try and create a maritime border along the Indo-Pacific that focuses on rule of law, shared norms, infrastructure and connectivity, trade, and a like-minded approach to how we deal with challenges in the region

The Belt and Road Initiative (BRI) came out of China in 2013 and has continued to evolve. It is a mega-infrastructure project that has one maritime pillar, sometimes called the Maritime Silk Road. It then has five land corridors, or land pillars, where China is funding the buildings of land, roads, bridges, and railways to try and open South-Central Asia and South Asia to the Chinese market. The logic is that if these countries are connected to the Chinese market, they will be able to trade. What will happen is that Chinese will buy those products, and the capital will return to those countries to help them develop.

The biggest distinguishing feature between these two projects is that FOIP really focuses on transparency, being environmentally green, fiscally transparent, and free of geopolitics. The BRI focuses on a non-legalistically binding approach to infrastructure cooperation. This means that BRI is quite attractive to other authoritarian regimes or regimes that are relatively corrupt. The FOIP is probably less attractive to those regimes because it has requirements for change of your government.

So, why do I call this a hedging strategy? Southeast Asian countries are really choosing both. It is not one or the other. They are doing both because they want to build their own capability so they can balance the great power competition within the region.

Let us look at Vietnam. Vietnam gets a ton of investment from Japan – Japan is building infrastructure in the region. Vietnam also agreed to BRI cooperation in January. Vietnam is looking at both as important contributors to Vietnamese development to help Vietnam become more autonomous. If it chooses only the Chinese version, it is likely going to be more dependent on China. If it only chooses the Japanese version, it is likely going to be more dependent on the Japanese version. By choosing both, by hedging, they are giving themselves the maximum choice in terms of how they are engaging with international partners. We see a similar pattern throughout the region.

In 2019, before the world was turned upside down by COVID-19, Prime Minister Abe visited Xi Jinping in Beijing and they signed fifty-five infrastructure projects in thirty-three countries. They did not do this under the umbrella of BRI. They said, “Well, we are going to find ways to cooperate in third countries,” maybe Thailand, maybe Myanmar. None of this has transpired, and it is because of the pandemic. We have seen a turn to the right in terms of nationalism and competition.

However, there was a vision by strong leaders that they could potentially cooperate. Right now, that window of cooperation has probably narrowed significantly because of the changing power dynamics within the region. Trust in China has evaporated, making it very difficult to cooperate. We need to have creative ways to think about how we can rebuild a degree of trust and cooperation with China. Whether it is on infrastructure or development policies, we must have a line of communication and cooperation to ensure that we do not balkanize or bifurcate our international order into a China order or an order that is broadly managed by the “cocktail of chaos” I mentioned. We have to continue to find opportunities to cooperate, as difficult as it is.

How does China view the framing of the Indo-Pacific as a concept? Can you also explain the idea of ASEAN centrality in the Belt and Road Initiative and how China’s position comes into play?

I think that the framing of the Indo-Pacific is absolutely something that the Chinese reject. There are a couple of reasons for this.

The Asia-Pacific framing puts China at the centre in terms of the region’s integration process. It is something that prioritizes China in the region’s economic integration. With the Indo-Pacific, fundamentally changes that framing. China is no longer the centre of the regional integration project – rather, it is the littoral states of the Indo-Pacific. What this means is that it gives those littoral states more say in terms of how the region is going to evolve and that is something that the Chinese do not want. They want to be “at the table,” not “on the menu” when it comes to rule-making and norm-making within this broader Indo-Pacific region. The framing of the Indo-Pacific decentralizes China. It means that they have to cooperate with other countries as equals, rather than as a superior. That is difficult from the Chinese standpoint.

The Indo-Pacific framing superficially does place ASEAN centrality at its core. What that means is we go through a consensus-based decision-making process in terms of how decisions are made. That means everybody must agree on how we do something or nothing happens. The ASEAN centrality also means that things are non-binding, which means that they do not have to agree on everything.

I think that ASEAN centrality means that as we think about the Indo-Pacific, we are thinking about the Indo-Pacific as being a construct that is not about security, but development, cooperation, infrastructure, connectivity, and trade. Growingly, the idea of economic security is important. We should be mindful that ASEAN was founded almost 60-70 years ago with the mindset that it needed to balance the great power competition between the Soviet Union, the United States, and arguably China. It used its ten-country membership to balance the size of those larger countries. The logic remains the same today. ASEAN members, individually, are too small to negotiate our international order with big countries like China, Russia, the United States, and India.

To what extent do you think Canada’s Indo-Pacific strategy has been effective so far in achieving some of its stated objectives? Has there been any measurable progress after the release of the strategy?

In traveling throughout the region and listening to government representatives and think tanks, these are my takeaways. Sometimes there are no questions about our Indo-Pacific strategy, which suggests that it does not have an impact. Sometimes I hear comments like, “What is Canada doing?” It is very schizophrenic. On the one hand, it talks about engaging with China. On the other hand, it disparages China.

In other capitals, they say that the currency of the region is no longer trade. It is about economic security and resilience. Where does Canada stand on this? Trade missions to the region are great, but we have already moved beyond trade. We are thinking about economic security and resilience, because there is this challenge of U.S.-China strategic competition, the bifurcation of the economy, of technology, and trade rules. We need to protect our economies and societies. That means we have to have an economic security policy and resilience. They also ask, “Where is Canada in terms of providing reliable energy security, as well as critical minerals?” Can Canada be that reliable partner to the region? The region is not just looking to buy Canadian products. It is wondering what Canada can do in the region or for the region.

Those are some takeaways I often hear from countries within the region. They never ask about the progressive elements of our Indo-Pacific strategy. They never ask about our engagement on indigenous issues in the region. Never. They do praise our innovative formulas for diplomacy, for example, cooperating with Taiwan, Australia, New Zealand, and the Pacific Islands on environmental policies. I think that that is quite interesting.

Rather than commenting on our Indo-Pacific strategy in general, they comment on concrete initiatives that really bring value. Here, I am talking about sanctions evasion activities that the Canadian Navy is engaging in in the Sea of Japan to prevent North Korea from gaining weapons and building its weapons of mass destruction program. We see great praise for Canada’s engagement with Taiwan through our One China policy. It is really mixed, but we do not hear a lot of praise about our Indo-Pacific strategy in general, but some of the concrete initiatives that have been thrown into our Indo-Pacific strategy.

Our updated defence policy, “Our North Strong and Free,” came out a few months ago. To what extent does it support or propose to support our Indo-Pacific strategy? Does it lay out any groundwork for Canada to engage the region further?

It is an important document that frames some of our defence priorities and where we should be investing our money in terms of securing a prosperous, free, and open Canada. The Arctic is a growing area of concern for many countries. We do see increasing cooperation and coordination between the Russians and the Chinese in that region. As the climate continues to change, we are going to see lines of communication in the Arctic open. What does this mean for the exploitation of resources? What will the Chinese and Russians do in that area? Will there be sovereignty claims in that area?

The big question for us in terms of our defence policies is “Where is the money coming from?” We talk about the modernization of NORAD. We have been donating a lot of money and resources to help the Ukrainians fight against Russia. Then we had defence cutbacks. It appears that we want to do more, we are investing more, but then we are cutting back at the same time. From our partners’ and allies’ point of view, this raises questions about what we are doing and brings back that idea of schizophrenia.

I am sure you saw the recent letter to Prime Minister Trudeau by senators in the United States saying, “When are you going to start meeting your spending expectations for NATO?” I think it was dismissed at the political level in Canada, but these are the kind of impressions that our allies and partners have. Not just one government, but many governments have not stepped up to the plate and met their security commitments. This creates some challenges in terms of our credibility. Our bureaucrats are great. Our defence department and Global Affairs Canada are home to some outstanding people. Ultimately, they serve the politicians, and the politicians right now have different priorities that would make it difficult for us to be a credible partner in many areas.

A big story from the past year was the murder of Hardeep Singh Nijjar, and then the ongoing foreign interference that has been alleged against China in our democratic process and elections. Given that China and India are broadly part of the Indo-Pacific region, how would you propose that we balance maintaining diplomatic relations with these countries while also addressing alleged interference in our democratic processes and security?

On the China front, China is a clear adversary of the United States. Canada is seen as a weak link in America. If China can influence Canadian policies, it can make the United States weaker. It is in the interest of Canada to think, who is our biggest trading partner? Which country do we share most of our values and institutions with? Which country do we have family ties with? It is not insignificant that many Canadians have cousins and wives and husbands and kids in the United States. The United States is our closest partner. We share values, we share institutions, we share interests, and as a result, we must prioritize that relationship. We must realize that countries like China are going to do everything in their power to try and fracture and create a wedge between the United States and Canada. That means interfering in our politics.

I think that is a good starting point for us to be thinking about this relationship and how we need to coordinate our policies. Not just with the United States but with like-minded countries – South Korea, Japan, Australia, political entities like Taiwan – to push back against political interference.

India, on the other hand, is curious. I think that there have been many mistakes with regard to India over the past ten years, and these mistakes are cumulative. It has created problems in a relationship that should not have problems. One of the most successful immigrant groups in Canada are people that come from South Asia, and India. They integrate well, go to university, learn the language, contribute, and form businesses. They are an important partner. In terms of a market, it is a growing market. It is not the same market as the Chinese or Southeast Asian market. It is a market we need to work more on.

At the political level, we have had some real differences. The assassination of an Indian-Canadian on Canadian soil is highly problematic. As we try to rehabilitate this relationship (which I do not know is possible under the current government), we will have to think about how we can discuss these issues behind closed doors using diplomatic tools, rather than making this a public fight, which does not work well with a country of 1.4 billion people. Canada has 40 million people. It is a rich, liberal society. It shares some values with India. On the other hand, it is very different. I think that we need to have a humble approach when it comes to dealing with a country like India, based on our size and capabilities, and the clear understanding that our values are very different than our Indian counterparts.

The central theme of my new edited volume is that the region is heterogeneous and seeking more strategic autonomy. We need to look at each country individually in terms of how we are engaging in the region. The take-home for policymakers or people who are interested in the Indo-Pacific is that we cannot look at the Indo-Pacific through China or India. We have to realize that it is very integrated, but the integration is like a puzzle. There are a lot of different pieces of this puzzle, and the puzzle comes together to form the Indo-Pacific.

As a result, as we think about Canadian engagement in the region, we need to think about a subregional approach to the region. For example, Canada should work actively to engage with South Korea, Japan, and Taiwan. They are like-minded political entities and share a lot of shared interests. When we move to Southeast Asia, we should prioritize Indonesia, Vietnam, Singapore, and maybe the Philippines. When we move to South Asia, India is a critical partner.

Doing this through shared interests rather than preaching our values will probably help us make friends, build credibility, and demonstrate that we respect the heterogeneity of the region. That allows for a sustainable, engaged Canadian presence.

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