Overlooking Beijing's downtown central business district is a 31-storey skyscraper, covered in glass. Time Out Beijing magazine describes it as the kind of building that "seems to have it all", with office space, upscale restaurants, fully-serviced apartments, a sports gym, high-end clothing shops catering to Canadian products, a bookstore, and even a spa for some "necessary TLC."
On the 23rd floor of this building's south tower is the 4,843 square foot-B.C. trade and investment office, where a team of Chinese and Canadian staff promote B.C. business interests.
While it's only one of many offices B.C. has scattered in seven countries around the world, this office is prompting some questions about rising costs, political back-scratching and the public’s right to know.
The monthly Beijing office rent in the Kerry Centre is more than $31,000, which is roughly what the average new Canadian immigrant earns in one year. From 2014 to 2016, this office was home base for Ben Stewart, the former MLA who vacated his seat to make way for Premier Christy Clark after she lost her riding in the 2013 vote.
Clark appointed Stewart B.C.'s special representative in Asia in October 2013. Soon after he arrived in the Chinese capital, the existing Beijing office in the Dongcheng district was moved to the Kerry Centre in the Central Business District. Annual rental fees, listed as being reimbursable for a maximum of $240,000 at the old location, rose to over $360,000 a year.
The Kerry Centre hosts top international law firms like Dentons, which hired Stephen Harper in 2016.
In addition to a total of $1,028,700 for Special Representative Stewart's salary, living expenses and other expenses from 2014-2016, he was supported by eight full-time staff from Ho Hing Consultancy. Headed by Kevin Tsui, Ho Hing Consultancy's work costs B.C. taxpayers well over $2 million a year.
Andrew Johns, a Vancouver-based financial advisor, says he was stunned by the costs while doing personal research on the subject.
And New Democratic Party MLA Bruce Ralston, whose requests for information were stonewalled a few years ago, says the money spent on the office would be better spent elsewhere — on daycare, for example.
Trade and investment offices
The province supports other offices abroad to build trade relationships. B.C. maintains four trade and investment offices in China (Beijing, Shanghai, Guangzhou and Hong Kong), three offices in India (Delhi, Mumbai and Chandigarh), an office in Japan (Tokyo), the U.K. (London), the Philippines (Manila), Indonesia (Jakarta), and in South Korea (Seoul).
And with an election looming on May 9, government-spending is under increased scrutiny. Johns, a 42-year-old Vancouver-based financial advisor from Port Alberni who recently began petitioning the B.C. government to move Family Day to be in line with other provinces, put out his own report called We Have an Office in Beijing? that criticized the cost of this office. Johns said he put his personal time and funding into the report. He said the project initially began after he started looking into B.C.'s 'Panda Bonds' investments in China, in which B.C.-created bonds are sold exclusively in the Chinese market.
While researching the bonds, he said he started looking into the costs of B.C.'s trade office in Beijing and was taken aback by sudden increases in fees to contractors over the years, especially when funding in areas like public schools were falling short.
"It's absolutely unchecked," Johns said. "The province has completely failed at being able to prove the positive financial benefit of having this office maintained in Beijing."
Johns, who got support from Green Party leader Andrew Weaver and NDP MLA David Eby for his family day petition, says he's not a member of any political party. He said he was upset at the way government was spending millions in taxpayer dollars, without clearly demonstrating how the average British Columbian was benefiting from these rising expenses overseas.
"It's political payback! You couldn't get him in the Senate?"
When former MLA Ben Stewart was appointed special representative to Asia in October 2013, Premier Clark's office received emails from the public, some congratulatory, others furious at Clark for providing him a "reward" for vacating his seat for her.
"Please do not take us for fools. The moment Ben Stewart stepped down, the first thing I said aloud was, 'I wonder what this will bring his way?'"
"Ben Stewart is the best man for this job? It's political payback! You couldn't get him in the Senate?"
"I have known Ben Stewart for 20 years...He'll be a great champion for trade in Asia."
While the BC Liberals triumphed in the 2013 election, Premier Clark lost her seat in Vancouver-Point Gray to David Eby, of the New Democratic Party.
Stewart, was handily re-elected with 58.4 per cent of the vote, but stepped aside allowing the premier to run in a by-election for his seat.
Political commentators speculated that the Beijing position was a "gift" for his help. A successful businessman who industry peers described as being "instrumental" to creating a World Wine Trade Group and an excellent representative for B.C. wines at the 2009 VINEXPO in Bordeaux, France, Stewart appeared to have little experience working in Asia, and was provided $2,400 a year to take Mandarin language classes in Beijing.
Clark asserted at the time that Stewart would be an important contact for Chinese officials looking to build relationships with B.C.'s government.
Ralston, the NDP MLA for Surrey-Whalley, said it seemed like a "classic political appointment," and that the new position was likely unnecessary because B.C. already had 24 full-time staff, mostly locals working to promote the province's interests in China. Requests for comment from Stewart were not returned.
Speaking to National Observer on Monday, Ralston said he got only vague responses when he asked International Trade Minister Teresa Wat questions in March 2014 about the expenditures and contracts being signed for B.C.'s trade offices abroad.
"I want to be clear that we (the BC NDP) do support developing trade opportunities for B.C., particularly in the Asia Pacific. Given the shifts in trade policies in the US, it's even more important now," Ralston said. "I just think when you spend that kind of money, the public is entitled to know. Meanwhile, we're being told there's no money for expanding childcare in B.C., but they have money for this."
Steep consulting fee increases
The amount paid to Ho Hing Consultancy, which worked in tandem with Stewart, shot up from just $431,168 in 2009-2010 to almost $3 million in subsequent years. According to the 2015-2016 Public Accounts, B.C. made two payments to Ho Hing ($2,316,985 and $456,820) for a total of $2,773,805, but it's unclear what exactly these increases were for.
The original contract stated that Ho Hing Consultancy was tasked by the B.C. government to "attract more than [redacted] million of foreign investment to British Columbia." Ho Hing Consultancy's 2010 contract says the company can receive a "performance incentive" if targets for investments brought in from China to B.C. are "outstanding."
Ralston said his office had made several freedom of information requests to see contracts from the trade offices across Asia in December 2013, but that their release was delayed for months because they faced an "objection" from the contractors themselves.
The B.C. Ministry of International Trade declined to comment to National Observer on Ho Hing's fee increases, stating that it is not allowed to provide media comment on public policy after the writ has dropped.
However, the ministry sent National Observer several government links providing context for some of the questions around B.C.'s trade and investment work in Asia.
The ministry forwarded National Observer a link highlighting B.C.'s Beijing trade office's "historic" agreement between Burnaby-based fuel-cell company Ballard Power Systems and Guangdong Nation Synergy Hydrogen Power Technology Co. Ltd.. The $168 million deal over five years was touted as a "milestone" for the company in developing a strong foothold in China.
The deal was made in Guangdong province in China, where B.C. already has an office with seven local staff working in the provincial capital of Guangzhou.
Alfred Wong, Asia Pacific managing director for Ballard Power, confirmed that most of the work was done through representatives in Guangzhou as opposed to Beijing. Ho Hing Consultancy does not have staff in the Guangzhou office, which is run by Guangzhou Jiayue Busienss Consulting. Wong said, however, B.C.'s Beijing and Guangzhou offices have both provided "secondary support" in the past, in the field of government relations and "getting the attention of influencers."
Ballard had already been working with Guangdong Nation Synergy prior to the deal, and was not introduced to this company by the B.C. government.
Controversial deal with Anbang
But while many deals have been successful, certain Chinese investments in B.C. have sparked controversy. When Beijing-based holding company Anbang Insurance Group took over B.C.'s largest retirement home chain in November 2016, at least one government representative admitted feeling "out of [her] depth" in internal emails responding to media queries about why a foreign firm was allowed to take over the care of B.C.'s seniors.
The sale of Retirement Concepts will give ownership of 24 retirement homes in B.C., including seven on Vancouver Island, to Beijing-based Anbang Insurance Group, which The New York Times called a state-sanctioned "domicile for shell companies." Recent U.S. deals between Anbang and insurance giant Fidelity, as well as with President Trump's son-in-law, both fell apart, with the former being blocked by state regulators.
Although the deal was overseen by the health ministry, both Special Representative Ben Stewart and Ho Hing Consultancy managing director Kevin Tsui were brought into the loop to discuss media talking points.
Other business deals negotiated by B.C. with China have fallen flat.
A National Post story from April 17 details how a number companies billed as "success stories" of Chinese firms relocating their firm to B.C. have either closed down or "sputtered" under closer scrutiny. A new Chinese fibre optics plant that was supposed to employ 200 people in Surrey, for example, never got off the ground, despite receiving a development permit in July 2015.
National Observer's requests for comment from Ho Hing Consultancy were not returned.
Value for money?
British Columbia is not unique in having international trade offices in key foreign cities. Alberta, Saskatchewan, Ontario and Quebec all have offices in China.
B.C.'s cost for maintaining a presence in China are much higher by comparison. Alberta paid less than a million dollars to pay 10 people (including 9 locals) to work in its Beijing office, and conducted work out of the Embassy of Canada, rather than paying for a separate downtown space.
By contrast, B.C. taxpayers put up the cost for over $1 million to maintain one special representative position over the course of a three years, including a $150,000 annual salary, $6,000 per month ($72,000/year) for living accommodations, $36,000 in transportation and $100,000 annually in travel costs.
The annual reports documenting B.C. trade offices' work list achievements such as:
- "Attracted approximately $3 billion in new investment" (2014-2015)
- "Connected BC cherry and blueberry producers to Chinese buyers" (2014-2015)
- "Telecommunication partnership between TELUS and Huawei" (2015-2016)
While the offices bring in billions of dollars in new investments from China, critics like Johns and Ralston say it's unclear what average British Columbians got out of three years of paying for a "special representative to Asia" position. Despite the numerous meetings and communications by the special representative office, Johns concluded in his report that it was doubtful that this position was truly necessary for B.C. to do business with China.
The ministry's website has no indication that a new special representative to Asia has been hired since Stewart left the position in December 2016.
The Kerry Centre office's three-year lease expired in March 2017, but appears to have been since renewed.
Correction April 29, 2017. The special representative position's position has been corrected from "two years" to "three years."