March 31, 1998 No. 76

MARCHI VISIT TO BEIJING REFLECTS CANADA'S

EXPANDING PRESENCE IN CHINA

Canada's International Trade Minister Sergio Marchi announced 13 new business initiatives today in Beijing, on the occasion of his first official trade mission to China. The Minister, who was accompanied by an 84-member business delegation, also took part in the opening of a Canadian Education Office and the launch of a silver coin to honour humanitarian Dr. Norman Bethune.

"Every day our embassies and consulates are helping Canadian companies make connections in China's developing markets. My mission supports this winning formula which, as the signings today show, is clearly getting results. We are seeing new, long-term investments, joint ventures and greater collaboration that is creating dynamic business partnerships," said Mr. Marchi.

The new business deals total in excess of $300 million (commercial contracts and agreements), as well as $48 million in investments. They involve such sectors as aerospace, construction, electric power, manufacturing, medical supplies, and education.

Four companies, SLM Software, W.J. Stelmaschuk and Associates Limited, and the law firms of Remedios and Company, and Blake, Cassels & Graydon, also announced plans to establish offices in Beijing. These firms join nearly 300 Canadian companies that have established a permanent presence in China.

"The very nature of Canada's trade relationship with China is changing and maturing," said Mr. Marchi. "We are seeing a significant increase in value-added Canadian exports and an

expanding role for Canadian companies in China`s services sector. Many Canadian companies are recognizing that by maintaining a permanent presence here, they can do business more effectively and more often."

Mr. Marchi also officially opened the new Canadian Education Office, located at the Canadian Embassy in Beijing. This facility will market Canadian educational services, such as high quality training, to Chinese companies and organizations.

"Canada offers world-class, competitively-priced education and training services. The new Canadian Education Office in Beijing is an impressive marketing and information resource for academic institutions across Canada," added Minister Marchi.

There are currently 3 500 Chinese students in Canada, not including short-term trainees. 1998 also marks the 25th anniversary of the Canada-China Scholars Exchange Program, which has produced about 400 Canadian and Chinese graduates who are now contributing their expertise to both countries in all fields.

On March 30, Mr. Marchi took part in the launch of a new sterling silver coin created by the Royal Canadian Mint to commemorate the 60th anniversary of Dr. Norman Bethune's arrival in China and his invention of the mobile surgery unit.

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A backgrounder on the deals announced today in Beijing is attached.

For further information, media representatives may contact:

Leslie Swartman

Office of the Minister for International Trade

(613) 992-7332

Media Relations Office

Department of Foreign Affairs and International Trade

(613) 995-1874

This document is also available on the Department's Internet site: http://www.dfait-maeci.gc.ca

NEW CANADIAN BUSINESS INITIATIVES IN CHINA

CAE Electronics Ltd., Montréal, Quebec

CAE Electronics has signed a contract with the Henan Electric Power Corporation (HEPC) for the supply of an automated hydro-electric dispatching system. This new system is scheduled for completion in 1999 and will increase the safety, efficiency and reliability of Henan province's rapidly developing power network. The system will be the basis for additional applications as the electric power industry in China's inner regions undergoes commercialization.

Canada-China Power Inc., Montréal, Quebec

The Canadian International Development Agency is providing

$200 000 in financial support to enable Canada-China Power Inc. (CCPI) and the Ministry of Water Resources to commence a review of foreign direct investment policies and regulations in China's hydro power sector. Recommendations resulting from this exercise will be incorporated into a pilot hydro project. The new policy framework emerging from this partnership is intended to accelerate the development of small and medium-sized hydro projects, creating new opportunities for private sector involvement.

Canadian Aerospace Group, Burlington, Ontario

Canadian Aerospace Group and the Harbin Aircraft Manufacturing Corporation, China, signed a contract to purchase the first two Y12 aircraft frames. The contract is part of a Memorandum of Agreement to purchase a total of 50 Y12 aircraft airframes in three years, with an option for an additional 150. The 19-seat regional aircraft will be manufactured in Harbin, China and sent to Canada for completion and sale by Panda Aircraft Corporation, a subsidiary of Canadian Aerospace Group located in North Bay, Ontario. Under the terms of this agreement, Canada will provide value-added manufacturing and equipment. Sikorsky Aircraft and Pratt & Whitney will also be partners in this project. The total commercial benefits derived from this deal for both Canada and China are expected to exceed $800 million over the next ten years.

Architects Crang & Boake Inc., Don Mills, Ontario

Architects Crang and Boake Inc. has signed today, with the Chongqing Fairy Ocean Enterprise Co. Ltd., a $2.4 million contract for the architectural design of the Chongqing Fairy Ocean Hotel. The Beijing Institute of Architectural Design and Research will act as the sub-designer for this project. The Chongqing Fairy Ocean Hotel project, valued at $140 million, will be the first five-star hotel in Chongqing.

Davey International Inc., Stoney Creek, Ontario

Davey International Inc. and Beijing Airport International Warehousing Co. Ltd. have signed a $4.6 million contract to build the third phase of the Beijing Airport International Warehouse. The construction of this two-storey 40 000 square metre air cargo handling facility will make use of Davey's proven expertise in pre-engineered metal building systems. This project, located in the Beijing Airport Industrial Zone, is the latest addition to the extensive number of metal buildings Davey has constructed in China since 1992.

Fulton Windows, Mississauga, Ontario

Fulton Windows has signed a $3.25 million contract with the Tiantai Group to export FULWAL curtainwall, a type of glass exterior, for the Taxation Mansion, a 28-storey building located in Qingdao, Shandong Province. This site is the first of three buildings under development by the Tiantai Group on the seaside site of the Tiantai Plaza in Qingdao. Fulton Windows adds this contract to a long list of projects undertaken in China, including the Hong Kong Convention Centre.

Madawaska Doors Inc., Bolton, Ontario

Madawaska Doors Inc. has signed a letter of intent with the Tianhai Group Yada Industry Co. of Tianjin to work towards establishing a joint venture processing/manufacturing plant in Tianjin, China. The plant will make use of Madawaska Doors Inc.'s technology and expertise to produce wood doors, frames and mouldings using raw material imported from Canada. The initial investment is expected to be in the range of $1 million. However, the long-term investment could surpass $6 million.

Mobb Medical Ltd., North York, Ontario

Mobb Medical Ltd. has signed a $2.1 million contract for the establishment of a new 20 000-square foot manufacturing and storage facility in Beijing for the Canada Angel Hospital Uniform (Beijing) Co. Ltd. The new plant will manufacture hospital uniforms and shoes, as well as dental hygiene products. Affiliated with Mobb Medical Ltd., Canada Angel Hospital Uniform (Beijing) Co. Ltd. was established in 1994 to provide hospitals across China with uniforms, supplies and equipment.

Panda North American Ventures Ltd., Vancouver, British Colombia

Panda North American Ventures Ltd. has signed a Memorandum of Agreement with the Daqing Municipal Government to build and operate a Canadian high school in Daqing, a city in northeast China. This facility will be the first foreign school in Daqing, with a capacity of 1 500 students. Under this agreement, the government of Daqing will invest approximately $1.2 million for the construction of a small hotel in Vancouver.

SLM Software, Toronto, Ontario

SLM Software has announced the opening of their Beijing Office. SLM provides software solutions to banking institutions, and is currently involved in a contract with the Bank of China for the computerization of the financial information system and for the establishment of bank and credit card software infrastructure.

Unitron Industries Ltd., Timberlea, Nova Scotia and AuDigital Hearing Care and Technologies Co. Ltd., Chengdu, Sichuan, China

Unitron Industries Ltd., a leading hearing instrument manufacturer in Canada, and AuDigital Hearing Care and Technologies Co. Ltd., a wholly owned Canadian enterprise based in Chengdu, Sichuan province, China, have entered into a joint venture agreement to manufacture high-tech hearing aids in China. Unitron will provide technical support and expertise to AuDigital, which will produce all styles of hearing aids for the Chinese market. This is the first large-scale project involving a leading Canadian hearing aid company in China.

W.J. Stelmaschuck and Associates Ltd., Pitt Meadows, British Columbia

W.J. Stelmaschuck and Associates Ltd. announced a construction project and plans to establish a children's entertainment facility, valued at $40 million and $2.5 million respectively. W.J. Stelmaschuck and Associates Ltd. also announced the establishment of reciprocal trade offices in Beijing, China, and Maple Ridge, British Columbia. Operating under the auspices of the Government of the Dongcheng District of Beijing, these offices will promote business deals between private sector entities in China and North America.

Yes Canada Education Services Inc., Penticton, British Columbia

Yes Canada Education Services Inc. has signed an agreement with Guangdong Education Services of International Exchanges and Beijing Second Languages University. The agreement offers Chinese students the possibility of pursuing MBA and post-secondary technology studies in Ottawa. Two hundred students have been admitted for the 1998-1999 school year. The value of this agreement is estimated at $5.6 million in its first year.