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Dataset Update Provides Evidence of Diversification in Chinese Investment in Canada

To capture the latest patterns of Chinese investment transactions in Canada, the research team at the China Institute has completed a number of updates to the China-Canada Investment Tracker database, which currently covers transactions between 1993 and 2014.

By employing refined search parameters to identify greenfield and joint venture projects, as well as continuous data collection from existing sources, we have added more than 40 new entries to the latest version of our dataset. Over 20 of these new entries are greenfield or joint venture projects. Furthermore, the research team works to supplement existing transaction data with new information if it becomes available, which has resulted in minor changes to a few existing transactions.

This update significantly enhances our understanding of recent developments in Chinese investment. Our data covering the past 18 months (July 2013 to December 2014) provide indicators of diversification away from investment in the natural resource sectors and from investment by state-owned enterprises (SOEs). Compared with similar indicators for the preceding 18-month period (January 2012 to June 2013), energy investments as a share of the total transaction value dropped 23 percentage points to 71%. The second-largest recipient of Chinese investment shifted from the metals/minerals sector to the consumer products/services sector (12%), followed by the automotive/aviation sector (6%). In particular, Chinese firms have invested US$353 million in the consumer products/services sector over the period of Jul 2013 through Dec 2014, which is considerably more than the same figure for the previous decade (July 2003 to June 2013) combined.

On the other hand, private firms are becoming more active in investing in Canada. We have observed that, between Jul 2013 and Dec 2014, privately-owned firms conducted 58% of the transactions and accounted for nearly half of the overall deal value. These ratios are substantially higher than those between Jan 2012 to Jun 2013. Even when considering only investments originating in mainland China (i.e. excluding Hong Kong-based firms), private firms still accounted for 48% of the transactions and 33% of the total transaction value between Jul 2013 through Dec 2014.

These findings and recent investment policy developments in both Canada and China will be discussed in greater detail in our Quarterly Update, which will be released in Spring 2015.

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