Ron Hoffman,Alberta's Senior Representative for the Asia and Pacific Basin
(ECNS) -- The resource-rich Canadian province of Alberta is eyeing the growing potential of Asia, particularly China, amid challenges posed by the recession in its energy sector.
"We found that we're overly-dependent on oil and gas. But we also know we have the building blocks in place to become a more innovation-driven economy, as China is striving to become," said Ron Hoffman, Alberta's Senior Representative for the Asia and Pacific Basin, in an interview with the China News Service website.
Having the world's third largest oil reserves, Alberta produces more than 70 percent of Canada's total crude oil. The current downturn in global oil prices has cast shadows on its economy, with reported oil projects halted and massive job cuts.
Soon after taking the post in fall of 2014, the former Ambassador to Thailand and Afghanistan made a review of Alberta's global strategy, which resulted in the cut of three offices in Ottawa, Chicago and Munich, and suspension of two opening ones in Brazil and California.
Alberta's third office on the Chinese mainland opened in Guangzhou last month, bringing the total number of liaison bases in the greater China region to five.
"Alberta has placed China as our most important international partner for future business development," said Hoffman, adding that the federal government shared the same vision.
Over the past year, Hoffman has been busy traveling from Hong Kong to the Chinese mainland, reaching out to local governments and enterprises to promote Alberta's capability. On the day before the interview, he "met representatives from six Chinese companies from different regions."
Hoffman said the shift of focus makes great economic sense for both Alberta and China. According to him, Alberta has drawn 70 percent of the $60 billion investment by China over the last 10 years. "The reality is that we don't need to do much persuading. Many Chinese companies are keen to invest in Alberta. So our job is just to facilitate them and help them to settle down," he added.
In terms of area, 90 percent of the investment has gone to the energy sector. Offering a different picture of the oil business, Hoffman said a lot of Alberta's oil companies are still profiting, though with a thinner margin. He also noted that despite the current difficulties, Chinese investments are not pulling out, because the two sides share the belief that it's a long-term business, and they can work together to cope with the challenge through innovation in drilling techniques and management.
As for other areas, Hoffman suggested growing interests have emerged in technology, education, and tourism, apart from traditional areas like agriculture and forestry. The University of Alberta, for example, is receiving the most national-funded Chinese PhD students in the world. "Many would assume our relationship with China would be slowed as China's economy is slowing. But the reality is quite the opposite," Hoffman said.
He added that Alberta can also serve as a platform to help Chinese companies go global and tap more opportunities through Canada's multiple trade networks with the U.S., the Europe Union, Latin America and TPP countries.
"We don't take Chinese investments as a threat to local businesses because we are a big province with a relatively small population," Hoffman said. He believes that Alberta's investment-friendly and low-tax environment would be a big advantage in attracting foreign companies.
As China is transforming into a more innovation-driven and greener economy, Hoffman noticed that China and Canada share a similar development path. Recently, the Canadian government has made pledges to achieve zero carbon emission in generating electricity by 2030, while China is also working on closing more coal-fired plants. As Canada is at the beginning of the process, Hoffman said this would probably be another area for future dialogue and cooperation.
