This is not some arm’s-length decision that the minister and his cabinet colleagues can disown.
In a staggering display of short-sighted ignorance, B.C. Ferries has awarded a multi-billion-dollar contract for four major vessels to a state-owned firm in China.
The minister responsible, Mike Farnworth, did his best to explain the deal by noting that building the ships in Europe would cost an additional $1.2 billion. That said, he then retreated behind the stale line that “B.C. Ferries is an independent company responsible for its own operational decisions.”
In fact, B.C. Ferries is, in everything but name, a wholly owned Crown corporation. The business is nominally owned by the B.C. Ferry Company, but the province holds the only voting share. And the majority of board members are appointed by the province, while the chair, Joy MacPhail, is a former NDP cabinet minister and deputy premier.
So this is not some arm’s-length decision that the minister and his cabinet colleagues can disown. It could only have been made with the full knowledge and support of the government.
Remarkably, in response to fierce criticism, B.C. Ferries CEO Nicolas Jimenez stated that he wasn’t worried about geopolitical tensions between Canada and China, adding his primary focus was getting the province a good deal.
Here are some of those “tensions” Jimenez ignored.
China has slapped a 25 per cent tariff on Canadian seafood, including B.C spot prawns, causing local retailers to cut their prices and lose money.
The Canadian Security Intelligence Service has reported that China has made repeated efforts to interfere in Canadian elections.
There have been reports of Chinese agents operating in Vancouver and other Canadian cities. Their purpose appears to be intimidation of Chinese nationals.
And Canada’s Communications Security Establishment calls China “the most comprehensive cyber security threat facing Canada today.” The Canadian Securities Exchange has found evidence of China infiltrating at least 20 cyber networks associated with the federal government, in the process stealing valuable intelligence.
When these issues were raised with Jimenez, he brushed them aside, telling reporters: “When it comes to things like trade policy, industrial policy, geopolitics, I think we would really defer that to the federal and provincial governments and expect them to manage and work those issues.”
Then there is the matter of China’s growing aggressiveness, toward Taiwan and, more broadly, through the expansion of its military presence both on land and at sea. It makes absolutely no sense to help finance this threat to global security by shovelling billions of dollars into that country’s treasury.
B.C. Ferries argues that there were no local bidders on the contract. Perhaps so. But whose fault is that?
For decades, all of the company’s ships were built right here, in Vancouver shipyards and at Esquimalt.
Yet through lack of foresight, a succession of NDP and Liberal administrations failed to keep this option alive. The fleet wasn’t kept up to date, and through lack of work, local shipyards atrophied.
B.C. Ferries has refused to say exactly how much the China contracts are worth. But it’s a fair assumption that had the work been done here at home, thousands of well-paying jobs would have been created with additional spin-off benefits in related fields.
Instead, as the B.C. Federation of Labour has said, this contract is a “colossal mistake” that will send hundreds of millions of dollars into the pockets of a “brutal authoritarian state.”
Nor is this the company’s first foray abroad. In recent years, a succession of ships have been ordered from German, Polish and Romanian yards. Each time the same sorry excuse was trotted out: Local firms weren’t ready.
What’s needed is a multi-year plan to award contracts to B.C. shipyards, with enough advance notice that owners have time to reboot. Has B.C. Ferries management the wit to see that?