China's lure yields few immediate deals

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A trade delegation to China with nine representatives from Inuit businesses and organizations found few immediate economic opportunities in China but some potential for future business deals.

The Inuit representatives were part of a group of business people and MPs who made the trip as part of the largest group of representatives from small and medium-sized Canadian companies to ever visit China on a trade mission. It was also the first trade fair to include Inuit representatives.

With a population of 1.2 billion - the largest in the world - the potential is enormous. China's economy has improved considerably in recent years, with average incomes rising by six per cent last year.

China is now in its eighth Five-Year Plan (1991-1995), and the ruling Communist Party projects economic growth of more than six per cent for that period, according to a paper prepared by Canada's Department of Foreign Affairs, and International Trade. In fact, during the first three years of the plan, China experienced double-digit growth and this rapid expansion is expected to continue.

The Plan emphasizes agricultural and infrastructure growth, especially in the transportation and energy sectors. Upgrading existing industrial enterprises also has a high priority.

For importers, this means China has a great need for forest products, fertilizers, metals such as copper and aluminium, lead, zinc and nickel, technology for heavy oil and sour gas, wheat, telecommunications technology and environmentally related products.

Some delegates had hoped that with incomes rising, Chinese people may have enough money to start looking at spending it on things like entertainment and clothes. That could create a market for arts and crafts and designer clothing produced by Canada's Native people.

Inuit traditional garments, including sealskin vests, embroidered slippers made of thick felt wool and parkas were showcased at the two-day trade show that kicked off what was to be seven days of meetings and seminars designed to foster business deals.

The booth showcasing the garments, art, dolls and several types of stone produced by the Inuit was a highlight of the show, with interested visitors frequently thronging the booth.

Martha Flaherty is from Inukjuak, Que. She is president of Pauktuutit, the national Inuit women's association, and she brought examples of the clothing and jewelry produced by some of the women in the 53 communities her organization represents.

While there was a lot of interest in the items displayed, orders were scarce. Three seal skin vests were ordered, but two of them were ordered by visiting Canadians.

Because each item is one of a kind, they are very labor-intensive and therefore quite expensive, said Heather Levecque, who works as special projects co-ordinator with Flaherty.

Most of the business people they spoke to say the only way to make their arts and crafts marketable in China would be to mass produce them, which would take the work away from the women in the North, Levecque said.

Lucassie Tooktoo, from Umiujaq, Que., was trying to generate interest in tourism in Canada's North. Tooktoo represents 14 outfitters who offer tourists opportunities to go hunting, fishing or sightseeing while possibly staying with an Inuit family.

Tooktoo discovered only about two per cent of the Chinese population has the kind of income that would afford them that kind of a holiday - not a huge potential market.

"I don't think we will get any," he said.

Dinah Andersen, from Nain, Labrador, is an artist who brought along samples of two kinds of stone for the Labrador Inuit Development Corporation.

Labradorite is a semi-precious blue-black stone used to make jewelry and other ornament objects. Anothrosite is a building stone composed of granite with a little Labradorite in it.

"It's competing right now with Norwegian blue stone," a very popular building stone, she said.

The small quarry at 10 Mile Bay in Nain produces small quantiies in blocks from 12-15 tons, which are shipped to Italy to be cut, polished and re-sold. Andersen was exploring possibilities of exporting the raw stone to China.

Marc Allard, general manager of Seaku Fisheries, a Makivik subsidiary, was exploring possibilities for exporting shrimp, fish and shellfish.

"There would be a demand for the project, but they just don't have the money for it," he said.

Generally, the Chinese businesses that took part in the convention were interested in establishing joint ventures and selling their products to North American markets, not in importing Canadian goods. They were also very naive about business, Allard added.

"All of these people we've negotiated with, it's been a one-way street. They're quite shrewed here: What can you do for us, and not much of the other way around," Allard said.

For instance, a Chinese businessman might want a bakery built. He would supply the land, but the Canadian would be expected to build the factory, supply all the equipment and technology, and then when a profit was turned, the sharing would start.

But there are no guarantees the business would be a success, and if it failed, the losses would all be the Canadian's.

Some Chinese businessmen proposed joint ventures with Canadians, who would be expected to help them set up businesses to manufacture goods for export which would compete with goods they already manufacture in Canada.

Wayne Greer, the Metis owner of Greer and Associates, a Sault Ste. Marie, Ont., consulting company, was exploring the possibility of selling an Introduction to Business program his company has set up.

"They're five years away from even being able to implement it," Greer said. He foresees a future deal with a postsecondary institution to implement the program as the only way to introduce it to China.

But Greer, the only non-Inuit Aboriginal with the delegation, may have found a lucrative deal importing silk flowers into Canada,. He visited a factory where he could puchase the flowers in quantities of 144 dozen for 15 cents each. The proposal still has to be analyzed and the logistics of transportation and distribution set up, but Greer is optimistic.

Another potential market is in furs and animal skins. China is one of the biggest fur consumers in the world, but their role is in processing the fur before shipping it off to Europe to be made into clothes, said Ping Tan, Chief Executive Officer of Inter Canadian Development Corporation, organizers of the convention.

This would take away from the people in the North who procure the furs, but it may in the long run provide more work for the hunters, said Vincent Buron, Director of Venture Development for Qikiqtaaluk Corporation in Iqaluit, Nunavut.

The Chinese are also interested in importing seal penises and testicles to be made into aphrodisiacs.

This has generated some protest from animal rights groups who argue seals may soon be hunted simply for their genitals, but Allard said this goes strictly against Inuit tradition, which dictates every part of an animal is used.