Federal lawmakers opened a parliamentary inquiry Monday into a $1 billion government loan supporting BC Ferries‘ acquisition of four electric ships from a Chinese state-controlled shipyard, as critics question the arrangement amid worsening Canada-China trade relations.
Parliamentary committee members agreed without dissent Monday to summon Transport Minister Chrystia Freeland, Housing Minister Gregor Robertson, and BC Ferries executives for testimony within 30 days about the Canada Infrastructure Bank financing arrangement.
The federal financing covers vessel acquisition costs of up to $690 million plus an additional $310 million for electrical infrastructure upgrades. BC Ferries selected China Merchants Industry Weihai Shipyards last month after a lengthy bidding process where no domestic shipbuilders submitted proposals.
Conservative MP Dan Albas requested Monday’s committee meeting. Separately, Conservative MP Leslyn Lewis called the arrangement “Liberal incompetence at best, and deliberately misleading to Canadians at worst.”
Critics attack the federal support for Chinese industry as Beijing retaliates with tariffs targeting approximately $4 billion worth of Canadian agricultural and seafood exports. China imposed the duties after Canada targeted Chinese electric vehicles, steel and aluminum imports last year.
A BC Ferries communications official, Jeff Groot, confirmed the company finalized its loan agreement with the federal bank prior to completing the shipbuilding contract. BC Ferries CEO Nicolas Jimenez has not responded to requests about appearing before lawmakers but previously stated the procurement occurred with no domestic companies bidding.
The Canada Infrastructure Bank said the vessels “wouldn’t likely be purchased” without federal financing. Bank officials stated the low-cost loan supports domestic ferry service and electrification goals.
The provincial ferry operator runs an extensive network serving 25 routes that link mainland British Columbia with Vancouver Island and coastal communities. Its fleet of 37 vessels transported 21.6 million passengers and 8 million vehicles last year, with many ships nearing replacement age.
The new vessels are expected to join BC Ferries’ fleet between 2029 and 2031.
The committee hearing will examine how the procurement decision was made and whether it undermines Canadian shipbuilding industry development. Committee members noted no Canadian shipyards submitted bids despite the project’s scale.
Canada’s National Shipbuilding Strategy, unveiled in 2010, focused on creating domestic capacity for building naval and coast guard vessels but apparently didn’t address ferry construction capabilities.
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