Committee for the Republic of Canada
Comité pour la République du Canada
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Dossiers

Canada: World Land-Bridge Gateway to the Americas

18 May 2018

By Robert Hux and Marcia Merry Baker

Executive Intelligence Review is pleased to announce the release in the coming weeks of a new Special Report, “The New Silk-Road Becomes the World Land-Bridge, Volume II,” which presents an in-depth nation-by-nation overview of the transformation of the world by the “Spirit of the New Silk Road;” a change which has occurred at an accelerating pace since Volume I was published in November 2014. The following is a slightly updated version of the article on Canada which will appear in the Special Report.

Although after five years, Canada still had not responded to Chinese President Xi Jinping’s 2013 invitation for nations to join the Belt and Road Initiative (BRI), it did take a step in this direction by becoming a member of the Asian Infrastructure Investment Bank (AIIB), the first North American country to do so. The decision was announced in Beijing on August 31, 2016, during Prime Minister Justin Trudeau’s eight-day first state visit to China where he met with Chinese Premier Li Keqiang, and President Xi Jinping, and later attended the China-led G20 Summit in Hangzhou, China.

Canada has had significant positive ties with China historically which should be built upon to establish a closer cooperation between the two nations, clearing the pathway for Canada to join the BRI. Canada is the gateway nation—adjacent the U.S. state of Alaska—for linking the Western Hemisphere to the World Land-Bridge, and is positioned as a frontline nation for the new Arctic frontier of development.

It was Justin Trudeau’s father, then-Prime Minister Pierre Elliott Trudeau, who, in 1968, showed the extraordinary foresight to begin the negotiations which led on October 13, 1970, to Canada establishing diplomatic relations with the People’s Republic of China, one of the first Western nations to do so. Even earlier, in the late 1950s and early 1960s, Canada’s wheat sales to an isolated “Red China” played a major role in helping them to overcome famines, while providing Canadian farmers a much needed export market. In the late 1980s, Canada provided the feasibility study for China’s Three Gorges Dam, which when built in 2008, finally freed China from the threat of deadly annual flooding in the Yangtze River Basin, while providing the capacity to generate 18 Gigawatts of electricity. In 1996, Prime Minister Jean Chrétien arranged Canada’s sale of two CANDU nuclear reactors to China, laying the basis for future cooperation in this area which still exists today.

The rail division of Canada’s Bombardier Inc., Bombardier Transportation, one of the world’s largest rail equipment manufacturers, now headquartered in Berlin, Germany, was the first foreign train maker to form a joint venture, technology-sharing agreement in China. Through such technology-sharing joint ventures, Bombardier, as well as other nation’s train builders such as Kawasaki Heavy Industries, Alstom, and Siemens, have benefited by the ability to upgrade their own high speed rail technologies to meet the huge demand for mobility in China; while giving China, beginning in 2006, access to state-of-the-art high speed rail technologies. The fact that in more recent years China has introduced its own even more advanced high speed rail designs should not be seen as a downside, since foreign train makers still have many opportunities in China, and the world is wide open for rail connectivity. Bombardier Transportation’s Chinese joint venture Bombardier Sifang (Qingdao) Transportation Ltd. (BST) was awarded a contract in 2017 to produce five eight-car high speed train sets with an operational speed of 250 km/hr for the Nanning Railway Bureau in the Guangxi Zhuang Autonomous Region of southern China.

Despite such political and economic ties, Canada has lagged behind many other countries in developing a forward-looking relationship with China—the world’s second largest and fastest-growing economy, and the BRI. In addition, China and Canada have cultural ties. For example, Canadians of Chinese ancestry make up 5.1% of Canada’s population (2016 Census), and China is the leading source of foreign students studying in Canada.

Instead of assuming its geo-strategic position in the Americas, Canada has so far been limited in its forward role, and captive to circumstances. There are two obvious aspects. First, as a member of the British Commonwealth, Canada has been restricted and harmed by the City of London’s anti-development policies. Secondly, Canada is adjacent the United States, which has been in decline, and holding back from the world New Silk Road.

Canada, with fewer than 37 million people, is surrounded by three oceans and bordered only by the United States, which for over a century has been the world’s leading economy, but now is in retreat. Two thirds of the Canadian people live within 100 miles (160 km) of the United States border on a tiny fraction of Canada’s territory. These are generally the regions accessible today by ocean shipping to Atlantic and Pacific ocean ports, and by inland maritime navigation up the Saint Lawrence River-Great Lakes Seaway, together with areas which were opened up for settlement by the two transcontinental railroads built in the late 19th and early 20th centuries. Canada’s primary modes of transportation by water, road, and rail have extensive connections south into the United States, the destination of three quarters of Canada’s exports, and source of over half of its imports of merchandise. Although most of the population lives in, and much of the economic activity takes place in, southern Canada, both depend to a significant degree, directly or indirectly, upon extraction and processing of natural resources which are increasingly located in central Canada or the Canadian Arctic. And in this case, water, road and rail connections into these resource-rich areas are sparse or, in many areas, nonexistent.

Among the features of what Canada’s participation in the BRI would mean, are initiatives in three areas: connectivity, the Arctic, and collaboration in key development areas internationally, especially nuclear. In turn, these efforts define significant increases in the manufacturing and agriculture sectors, and an exciting future of population and settlement expansion in Canada’s vast and beautiful territory.

Connectivity

Canada has two unique prospects for dramatically new rail corridors, in addition to the rail connectivity expansion needed throughout its existing, limited rail grid, which is oriented almost entirely along the Canada-U.S. border. First, the Bering Strait rail tunnel link with Asia, after traversing the U.S. state of Alaska, then proceeds into Canada, enabling not only the long-overdue direct line into the Lower 48 U.S. States, thence through Mexico, and Central and South America, but opening up vast areas for agro-industrial development across Canada. The Bering Strait link means modern, direct overland connections directly from Canada across Asia, into Europe and Africa. A new world of opportunities.

This gives new life to the proposals which have been around for decades for a “Canadian Northern Corridor” multi-modal belt across the nation’s north and near-north. In the 1960s, this idea was proposed by Major General (Retired) and author Richard Rohmer; it was then known as the “Mid-Canada Corridor.” Simultaneously with the Belt and Road Initiative corridors now stretching across Eurasia, there has been renewed discussion in Canada on the trans-Canada corridor concept. A study group exists at the University of Calgary School of Public Policy and CIRANO (Center for Interuniversity Research and Analysis of Organizations, Montreal); and the concept has been taken up in Ottawa over 2016-2017. Though much of the support for the idea derives from the desire to build infrastructure to access the vast mineral wealth of Canada, the merits of the “Northern Corridor” are in no way limited to that. There are exciting challenges, for example, establishing agriculture, through innovative practices for northern-latitude farming, using new methods to overcome the harsh continental weather patterns, and poor soils common on the Canadian Shield.

Though details are not worked out, the idea is for a 7,000 km infrastructure corridor to cross Canada, accommodating rail and roadways, pipelines, electricity transmission and communications. The Calgary group issued a study in 2016 of their review of essential preliminaries, including rights of way.

Also of note in this light, is Novaporte, a proposed mega-container facility at Port of Sydney, Nova Scotia which would be the first deep-water port on the east coast of North America designed specifically to accommodate the largest container ships in the world (18,000 plus TEUs) - allowing trans-Atlantic shipping a 2-day shorter trip compared to the Port of New York/New Jersey. In April 2016 China Communication Construction Company was retained to prepare the feasibility study.

One of the more compelling examples of what Canada’s participation in the BRI would mean is the case of Newfoundland and Labrador, the last province to join Canada in 1949. Although its Port of St. John’s would allow an even shorter trip for trans-Atlantic shipping than Nova Scotia’s Ports of Sydney or Halifax, the province’s only railroad, 1,500 km of narrow gauge track linking St. John’s with Port aux Basques 550 km to the west, was abandoned in 1988. The province is proceeding with a pre-feasibility study for a 17 km tunnel under the Strait of Belle Isles at its narrowest point linking the island of Newfoundland to Labrador. Although the plans call for a shuttle train to replace the current ferry service, perhaps rebuilding the Newfoundland Railway to modern standards and linking it with a rail tunnel, or bridge, to Labrador could finally connect the province to what should become a new system of passenger and freight rail services for the entire country.

Arctic Frontier

The population and productivity growth implied in this “Northern Corridor” vision, goes right along with Canada’s participation in Arctic Silk Road activity. In transportation terms, a proposal exists for connecting an expanded national Canadian rail grid, to the Arctic Ocean coast in the north. The line would run from Hay River, Northwest Territories, the northernmost stop of the Canadian National Railway on the banks of Great Slave Lake, northward down the McKenzie River Valley, reaching the coast at Tuktoyaktuk, the Northwest Territories. This is analogous to the Arctic Circle connections now in Russia and Scandinavia. (See section on the Arctic Silk Road). In addition, the Port of Churchill, Manitoba, Canada’s only deep water Arctic port, and the Hudson Bay Railroad which serves it, need to be revived. Although it is only open four months of the year, the “Arctic Bridge” shipping route between the Port of Churchill and Murmansk, Russia offers a significantly shorter connection between North America and Russia than the conventional route through the Saint Lawrence Seaway.

Nuclear

As a legacy of Canada’s participation in the Manhattan Project of World War II, Canada became the second nation to control a nuclear fission reaction, in September 1945. After the war in 1946, an English physicist Dr. Wilfred Bennett Lewis took charge of the Canadian National Research Council’s nuclear research facilities at the remote Chalk River, Ontario site along the Ottawa River. When the federal Crown corporation, Atomic Energy of Canada Ltd. (AECL) was set up in 1952, Lewis became the Vice President of Research and Development and took up the task of designing a distinctively Canadian approach to the design of a nuclear fission power reactor. As a result of a partnership between AECL, the Hydroelectric Power Commission of Ontario (Ontario Hydro), and Canadian General Electric, the Candu reactor was born: a Canadian-designed reactor using heavy water (deuterium oxide) to moderate the nuclear fission process and natural uranium (as opposed to enriched uranium) as the fuel.

Since the first Candu prototype, the 20 MWe Nuclear Power Demonstration (NPD) reactor, came on line in 1962 in Rolphton, Ontario, to be followed six years later by the first full-scale power reactor, the 220 MWe Douglas Point reactor in Kincardine, Ontario, Canada’s nuclear fleet has expanded to 19 reactors, mostly in Ontario, which provide 13.5 GWe of power capacity, and generate 15% of Canada’s electricity. An additional 12 Candus have been exported to: Argentina (1), China (2), India (2), Pakistan (1), Romania (2) and South Korea (4), India has also built 16 indigenous pressurized heavy water reactors (PHWR) modelled on the Candu design, and Siemens has built 2 PHWRs in Argentina. Of the 449 nuclear power plants currently operating worldwide, the vast majority (382) are light water reactors, but the 49 PHWRs have a significant role to play in meeting the demands for reliable baseload electricity generation.

Canada’s nuclear sector has undergone a dramatic restructuring in the period since June 2011 when the federal government of Prime Minister Stephen Harper arranged the sale of AECL’s commercial reactor division to Candu Energy, a wholly-owned subsidiary of the Montreal-based international engineering company SNC-Lavalin Group Inc., for C$15 million plus C$285 million in future royalties earned through the sale of new reactors. Candu Energy has focused on completing the design for the 740 MWe Enhanced Candu 6 flagship reactor, while it pursues new build opportunities and the highly specialized task of refurbishing the fleet of 31 aging Candus in Canada and around the world.

On September 22, 2016, during an official four day visit to Canada by Chinese Premier Li Keqiang, SNC-Lavalin Group Inc. announced that they had signed an agreement in principle to create a joint venture with China National Nuclear Corp. and Shanghai Electric Group Co. Ltd. to design, market and build the Advanced Fuel Candu Reactor (AFCR). China’s interest in the technology comes from the fact that they currently have 38 nuclear plants, with 20 more nuclear plants under construction, and more in the planning stage – almost all of these are light water reactors - but only limited supplies of uranium. One AFCR reactor would have the ability to reuse the spent fuel from four light water reactors to generate an additional six million megawatt hours of electricity annually without needing any additional natural uranium fuel. The joint venture would also open the possibility of exporting the technology to other parts of the world.

AECL’s Chalk River Laboratories (now Canadian Nuclear Laboratories) - which is still government owned, but now managed by the Canadian National Energy Alliance, representing a group of experienced nuclear engineering and management firms, including: CH2M Hill Canada, Fluor Government Group Canada, Energy Solutions Canada Group, SNC-Lavalin, and Rolls-Royce Civil Nuclear Canada – is undergoing a major transformation.

CNL’s National Research Universal (NRU) reactor, one of the largest and most versatile high-flux research reactors in the world, and a major source internationally for radioisotopes for medicine and industry, closed down on 31 March, 2018 after 60 years of operation. The Canadian Nuclear Isotope Council, a coalition of Canadian science, healthcare and nuclear sector organizations, has been formed to ensure Canadian production of critical radioisotopes such as cobalt-60 and molybdenum-99 through alternative routes using commercial power reactors, research reactors or particle accelerators across Canada. 

The federal government is providing a C$1.2 billion investment over ten years, to “strategically consolidate and modernize” the Chalk River site, with the construction of an Advanced Nuclear Materials Research Centre complex and other infrastructure and facilities to support the nuclear research needs of the Canadian government and the science and technology needs of the Canadian and global nuclear industry. CNL has four broad application-driven science and technology development programs: energy, including extension of the life of existing reactors, fabrication of advanced nuclear fuels, deployment of small modular reactors (SMRs), and decarbonisation of the transportation sector; health, including radiobiology research and targeted alpha therapy; safety and security; and the environment, including decommissioning nuclear sites and radioactive waste management.

In June 2017, CNL issued a Request for Expressions of Interest in CNL’s Small Modular Reactor Strategy which received 80 responses: from Canada (51), U.K. (11), U.S. (9), Europe (5), China (1), Japan (1), Brazil (1) and one other country. The responses included 19 expressions of interest to build a prototype or demonstration reactor at a CNL site, spanning a wide range of SMR concepts. Canada’s nuclear regulator, the Canadian Nuclear Safety Commission (CNSC) is involved in pre-licensing vendor design review (VDR), an optional service to assess a nuclear power plant design based on a vendor’s reactor technology, for ten SMRs with capacities in the range of 3 to 300 MWe. For example, the Canadian company Terrestrial Energy announced in November 2017 the completion of the first phase of CNSC’s pre-licensing VDR for their Integral Molten Salt Reactor, a 400 MWt (190 MWe) modular design which they expect could be ready for deployment in 2026. Other VDR applications which CNR has received include those for NuScale Power’s 50 MWe self-contained integral pressurized water reactor and Westinghouse’s eVinci micro-reactor, capable of providing heat and power from 200 Kwe to 25 MWe and process heat up to 600 degrees Centigrade, which would be suitable for remote communities, mining sites and industries in Canada’s north and near-north.

Finally, it should be noted that CNL’s Tritium Handling Facility which has the technologies to remove this mildly radioactive isotope of hydrogen (and ideal first generation fusion fuel) from a Candu reactor’s heavy water feed, can also provide crucial support for Canada’s fusion program. The Canadian fusion community based in universities, industry and research support organizations across five provinces has an active program covering the spectrum, from magnetic confinement (tokamak), inertial confinement (laser), and magnetic target fusion, as described in a 2016 report, “Fusion 2030: Roadmap for Canada.”

Canada’s bid to become a leading international test bed for small modular reactors, together with the capabilities of its fusion community, can help to accelerate the delivery of reliable, low cost power and heat to regions in the Mid-Canada Corridor and the Canadian Arctic where transportation costs dramatically increase the cost of everything from food to diesel fuel, as it also serves as an opportunity to increase our collaboration with the United States, China, Russia, and India. It would truly be in the interest of Canada to cooperate more closely with each of these nations, all of which not only have significant capabilities in the nuclear sector, but which also happen to be the Four Powers upon whose close collaboration the success of the Belt and Road Initiative depends.

The next step lies in deepening Canada’s already ongoing collaboration with each of the Four Powers in Space, to chart the path for mankind’s future on the Moon, Mars, the entire Solar System, and beyond.