Welcoming the China effect

Take the "Gone Fishing" sign down from the window. Canada is open for business again.

AweekaftertheHarper government blocked BHP Billiton's bid forPotashCorp.,FinanceMinister Jim Flaherty announced Wednesday in apressrelease that China's government has cleared that way for some of the country's investors to plow as much money as they want into Canada.

Chinamaintainssomethingcalledthe Qualified Domestic InstitutionalInvestor Program,whichdetermineswhich money managers get to investoutside China, andwhere.China'sbanking, securities and insuranceregulators all mustagree beforetheinstitutions and investors theyregulate can investabroad. OnWednesday,Mr. Flaherty saidthat the insuranceregulator gave the greenlight toCanada, matchingearlier decisions bythe banking andsecuritiesauthorities.

ForMr.Flaherty,theagreement represents a victory won through leg workandface time.Overthe last couple of years, the Harper government hastakenatotallydifferent approach with China, dropping the publiccomplaintsaboutthecountry's human rights record, and insteadfocusingonbuildingtrade-and-investment links.

"WhenI was there inJanuary2007, wehad some discussions about some issues,and there was not alotofprogress right after that," Mr. Flahertysaid in aninterviewafterarriving in Seoul for the Group of 20 Summit. "This year has been quite different…It is indicative of an increasingly positive relationship."