German leader brings CEOs on visit

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FRED CHARTRAND / THE CANADIAN PRESS Stephen Harper explains an inukshuk at Harrington Lake to Angela Merkel. (CP)

GATINEAU, Que. -- Team Canada, meet Team Germany.

As Chancellor Angela Merkel and Stephen Harper kicked off her two-day visit at the prime minister's retreat Wednesday night, a major German warship builder and a leading Canadian defence contractor were among 10 companies poised for talks of their own.

The chief executives of Germany's ThyssenKrupp Marine Systems and Canada's CAE Inc., which manufactures defence simulators, are among the 10 who will attend a Parliament Hill business luncheon today with Merkel and Harper.

Merkel's visit with Harper is being billed as a chance for two established western leaders to have quality face time on the weighty economic and political issues of the day. But a mini trade mission is shaping up as a major component of the German leader's visit.

Merkel arrived with five major German business leaders in tow. They will be joined by five Canadian counterparts at today's luncheon. They all remained in Ottawa Wednesday night as Merkel and Harper met for an informal two-hour conversation over dinner at the prime minister's Harrington Lake retreat a half-hour drive across the Quebec border.

ThyssenKrupp Marine is under contract with National Defence for help in the building the Canadian navy's new supply ships. A German design based on the existing Berlin-class support ships is considered among the leading contenders.

More importantly, the company is considered a leading candidate within the defence community if the federal government decides to replace the military's problem-plagued, British-built Victoria-class submarines.

Appearing before a Senate defence committee a few months ago, the head of the Royal Canadian Navy said defence planners had begun to consider timelines for replacing the current submarines, which is expected to take more than a decade.

In addition to ThyssenKrupp, the German contingent includes the head of chemical giant BASF as well as K+S Group, which broke ground in June on the $3.25-billion Legacy mine, Saskatchewan's first new potash mine in four decades.

"When the chancellor travels, she likes to have business people around to give them an opportunity to meet and mingle with counterparts in the host country," a senior German official said, speaking on the condition of anonymity.

The Canadian side will include the CEO of CGI Group, the consultancy employing retired army general Andrew Leslie, whose name has been mentioned by the Ottawa rumour mill as a candidate for the country's new defence chief. The CEOs of embattled Research in Motion and the information management company OpenText Corp. will also attend.

The most lucrative pairing at Thursday's lunch could be the ThyssenKrupp-CAE matchup. Construction of the navy's new supply-ship project, known as Joint Support Ships, is in the planning stages and expected to be done by Seaspan Marine Corp. in Vancouver.

Merkel's plane touched down in Ottawa late Wednesday afternoon, beginning the two-day meeting.

The two will have a rare, uninterrupted private session at the prime minister's Harrington Lake, Que., retreat. A more formal meeting is scheduled today in Harper's Parliament Hill office.

Harper will be keen for an update on the European economic situation. Earlier Wednesday, Finance Minister Jim Flaherty repeated Canada's familiar lament that Europe's efforts to contain its financial woes are falling short.

"Not enough has been done," Flaherty said. "They need to do much more."

Merkel's visit unfolds after Canada's refusal to contribute to a global bailout package through the International Monetary Fund.

Flaherty reiterated that position Wednesday, but also showed frustration with the Europeans for not taking what he said are clear steps to remedy their economic problems.

"It really is up to them to deal with this issue. This is a European issue... "

Merkel and Harper are also expected to discuss Canada's bid for a free-trade pact with the European Union.

Althogh Germany wants the talks to succeed, officials say Merkel will avoid any enthusiastic public statements of support as the negotiations enter the crucial home stretch.

Canada estimates a free-trade pact with the 27-country trading bloc could boost the economy by $12 billion annually. Harper wants a deal struck by the end of the year and has said the EU trade talks were progressing well.

-- The Canadian Press

Republished from the Winnipeg Free Press print edition August 16, 2012 B5