The Bank of Canada Governor Went to Beijing to Sell Trade Deals. That Is Not His Job.

Bank of Canada Governor Tiff Macklem is in Beijing. He arrived Thursday morning at the Canadian embassy alongside Finance Minister François-Philippe Champagne, where they were greeted by Ambassador Jennifer May. Macklem then sat at a roundtable with CEOs from Manulife, Sun Life, BMO, CIBC, RBC, TD, National Bank, Power Corp., Mackenzie Investments, the Canada Pension Plan Investment Board — and Brookfield Asset Management.¹

Brookfield. The company whose former chairman is the current Prime Minister of Canada. Mark Carney has agreed to a conflict-of-interest screen related to decisions involving Brookfield. Conservative MPs criticized the inclusion of Brookfield in the meetings. But there was Brookfield CEO Connor Teskey, sitting at a table in Beijing alongside the governor of the central bank and the finance minister, advancing trade objectives set by the man who used to run his company.²

The Bank of Canada’s mandate is set out in the Bank of Canada Act. It is responsible for monetary policy, financial stability, currency management, and funds management for the federal government. Nowhere in that mandate is trade promotion. Nowhere does it say the governor should join political delegations to foreign capitals to help sell Canadian financial services to a government that detained two Canadian citizens on fabricated espionage charges for nearly three years.³

Macklem’s office confirmed he is in China “as part of the Canadian delegation” but declined to provide details about who he is meeting. That itself is remarkable. The governor of an independent central bank — the institution responsible for setting interest rates that affect every mortgage, every loan, and every savings account in the country — is on a trade mission, and his office won’t say who he’s talking to.

On Friday, Macklem and Champagne met with China’s Vice-Premier He Lifeng at the Diaoyutai State Guesthouse. They signed a joint statement establishing the first Canada-China Financial Working Group, pledging “frequent exchanges” between regulators and financial institutions.⁴

Central bank independence is not a principle governments talk about when it’s convenient and ignore when they need a trade envoy. It is the foundation of credible monetary policy. When the governor of the Bank of Canada sits at the same table as political ministers and private-sector CEOs advancing the government’s export targets, the line between independent monetary authority and political instrument disappears.⁵

Eric Prouzet / Unsplash — The Bank of Canada’s mandate is monetary policy, financial stability, and currency management. Trade promotion is not in the job description. Macklem’s presence in Beijing alongside Brookfield executives raises questions about central bank independence.

Macklem said in Beijing: “We talk about diversifying our trade. We need to do it. It’s critical to our prosperity, our productivity, our resilience as a country. Our financial-services industry has a key role to play.” That is a political statement. It is the government’s trade diversification strategy, articulated by the governor of the central bank, in a foreign capital, at a table that includes the prime minister’s former employer.

The trip follows Carney’s visit to China in January, where he met with President Xi Jinping and pledged to increase Canadian exports to China by 50% by 2030. Champagne described the Beijing meetings as “putting in motion the plan that has been set by the Prime Minister.” The governor of the Bank of Canada is now executing the prime minister’s trade plan. Those are not the same institution. They are not supposed to be.⁶

Canada and China are re-engaging after roughly eight years of limited formal interaction — a freeze that followed the 2018 arrest of Huawei executive Meng Wanzhou in Canada on a U.S. extradition warrant, and China’s retaliatory detention of Michael Kovrig and Michael Spavor. The two Michaels were released in 2021 after Meng cut a deal with American prosecutors. The relationship remains fraught. U.S. administration officials have already criticized Canada’s rapprochement with Beijing.

Canada’s trade deficit with China is enormous. Exports to China totalled $34 billion last year. Imports from China were $90 billion. The government’s stated goal is to close that gap. That is a legitimate policy objective — for the finance minister, the trade minister, and the prime minister. It is not a legitimate objective for the governor of the central bank.

The Brookfield question compounds the problem. Carney served as chairman of Brookfield Asset Management before becoming prime minister. He has acknowledged a conflict-of-interest screen. Brookfield CEO Connor Teskey was part of the delegation that met with China’s Vice-Premier on Friday. The government’s trade mission is advancing commercial opportunities that directly benefit a company Carney led — with the central bank governor providing institutional credibility to the effort.⁷

The Bank of Canada exists to manage monetary policy, not to sell trade deals in Beijing. Its governor’s credibility depends on independence from the government of the day. Tiff Macklem is now on a political trade mission, sitting alongside the prime minister’s former employer, executing the prime minister’s export targets, in a country that imprisoned two Canadians for political leverage. He signed a joint statement with China’s central bank establishing a bilateral working group that will produce “frequent exchanges.” His office won’t say who he met. The Bank of Canada’s mandate does not include trade promotion. The governor’s job is not to be the finance minister’s wingman in Beijing. If the government needs a trade envoy, it should send one. If it needs a central banker, it should leave him in Ottawa — where his independence is the only thing that makes his interest rate decisions credible.