When François-Philippe Champagne was promoted to minister of foreign affairs in a Cabinet shuffle last November, he received his marching orders from Justin Trudeau in the form of a mandate letter.
“The arrangement of your private affairs should bear the closest public scrutiny,” Champagne was advised. “This is an obligation that is not fully discharged by simply acting within the law.”
In that context, the revelation in the Globe and Mail that Champagne has two mortgages, with an outstanding balance of $1.2 million, with the state-owned Bank of China is stupefying.
It’s true, the arrangement has been hidden in full public view on Champagne’s public disclosure statement with the Ethics Commissioner since he became a minister in 2015.
But there’s a qualitative difference to holding mortgages with a Chinese bank when you are infrastructure minister, or even trade minister, and being indebted to Communist China as Canada’s most senior diplomat.
The mortgages were arranged on two properties in London, England, in 2009 and 2013, before Champagne entered politics and was working in the U.K. As a temporary resident, he said he was unable to secure a mortgage with a British bank.
Fair enough. The minister might also hold his hands up and say that, since he disclosed the details to the ethics commissioner, there are no hidden obligations and he is off the hook. His liabilities have not had any bearing on his function as a public office holder, he said. We must then, take at face value that when in 2017 he told a state-backed TV station that China is “a beacon of stability, predictability, a rules-based system, a very inclusive society”, he did so from conviction.
Yet, as his mandate letter makes clear, acting within the law does not absolve him. Champagne’s private affairs do not stand up to public scrutiny, at a time when Canada’s relations with China have soured.
We know the Chinese communist regime is capable of using all kinds of leverage to expand its influence, including “threats and bullying” to intimidate and silence activists in Canada, according to a coalition of human rights groups led by Amnesty International.
When you owe someone more than $1 million, the potential for influence and abuse is ever-present.
Margaret McCuaig Johnston, a senior fellow at the China Institute at the University of Alberta was a senior bureaucrat in Ottawa for 37 years. She said she doesn’t recall anything as egregious as this case in her time. “It is inconceivable that this is not at the back of his mind as he deals with the government of China, his most difficult file,” she said.
The much wider concern is that no-one else in the Trudeau government considered that Champagne’s financial dealings with the Bank of China might be a problem. That speaks volumes about the naiveté that has characterized this government’s approach to China since it came to power.
This is a self-inflicted wound that can be cauterized quickly. Both apartments are in highly prized parts of London – average property values in Shoreditch are $1.2 million; in Bayswater they are $2.5 millon. Selling just one would allow the minister to discharge the mortgages and end any obligation he has to the Chinese.
He should indicate his intention to do so as soon as possible.
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