OTTAWA -- Prime Minister Stephen Harper begins one of his longest overseas trips Saturday, with six days in India, a day in the Philippines and a day in Hong Kong.
But, really, this trip is all about China.
Allow me to explain.
Late Friday, the federal government announced that it had delayed until Dec. 10 a decision on an application by China's state-owned oil company, CNOOC, to buy Calgary oil and gas producer Nexen for $15 billion.
If it goes through, this will be the single largest foreign acquisition ever by a Chinese firm anywhere in the world.
In saying yes to the government's request for a delay, CNOOC showed better sense than the Malaysian state-owned oil company Petronas, which said no two weeks ago to a last-minute request from the Harper government to delay a decision the government must make on Petronas' $4 billion bid for Calgary's Progress Energy. Because Petronas said no to the delay, the government said no to the Petronas bid.
Petronas has until the end of the month to re-submit an amended application and plans to do just that.
At the heart of both bids is this question: Is the government of Canada prepared to let state-owned foreign enterprises take complete control of Canadian resource companies?
But delaying the CNOOC decision doesn't mean Harper can avoid that bigger question next week in Asia, particularly at a World Economic Forum speech he'll give in New Delhi on Wednesday. All investors want to know Canada's ground rules, not just state-owned enterprises.
Right now, foreign investors from New York to Hong Kong are confused. Why, they wonder, is Canada hesitating on Petronas and Nexen when they gave the green light to many other deals involving state-owned enterprises.
For example, when China Petrochemical Corp., another Chinese state-owned enterprise more commonly known as Sinopec, offered $2.2 billion for Canada's Daylight Energy Ltd. last year, the Harper government said yes.
In fact, between them, CNOOC and Sinopec have snapped up about $30 billion worth of Canadian assets in the last five years - all with the approval of the Canadian government.
And China wants more. That's because Harper himself encouraged more Chinese investment when he visited Beijing last winter. The Chinese were so enthused about the PM's unambiguous invitation to invest that the Chinese state-owned newspaper, the China Daily, put a picture of the Canadian PM on the front page of the paper two days in a row.
But now, as Harper himself has said, Canada wants to set out some more clear guidelines about how it's going to deal with takeover bids from state-owned enterprises, particularly those from countries like China where the Canadian commitment to human rights, property rights and the rule of law is absent.
In spending six days in democratic India -- the longest stretch Harper's ever spent in any country since becoming PM -- Harper is sending a not-so-subtle subtle message that India, which does share Canada's values on property and human rights, would be an excellent source of new foreign investment.
Unfortunately, foreign investors remained spooked by the government's hesitation on Petronas and CNOOC. In the last several weeks, I've spoken to more than a dozen foreign money managers responsible for investing billions anywhere in the world. They say that though Harper insists Canada is open for business, he gets judged just as a pro athlete does -- on his last game. And on that score, Canada looks closed for business.
Harper has eight days in Asia to begin to reverse that reputation.
Prime Minister Stephen Harper heads to Asia Saturday and will visit India, the Philippines and Hong Kong. Here's his itinerary (all times local)
SATURDAY, NOV. 3
-- Travel day
SUNDAY, NOV. 4
-- Arrives in Agra, India
MONDAY, NOV. 5
-- Tours the Taj Mahal
-- Travels to New Delhi, India
TUESDAY, NOV. 6
-- Meets Indian Prime Minister Manmohan Singh
WEDNESDAY, NOV. 7
-- Speaks to World Economic Forum
-- Travels to Chandigarh, India
THURSDAY, NOV. 8
-- Participates in cultural events in Chandigarh, India
-- Travels to Bangalore, India
-- Tours local businesses
FRIDAY, NOV. 9
-- Travels to Manila, Philippines
SATURDAY, NOV. 10
-- Meets Filipino President Benito Aquino
SUNDAY, NOV. 11
-- Travels to Hong Kong
-- Marks Rememberance Day at Sai Wan Cemetery
-- Travels to Ottawa