The Saudi Foreign Ministry on Aug. 5 announced that it was recalling its ambassador to Canada and gave the Canadian ambassador in Riyadh 24 hours to leave the country. The ministry's statement also detailed a ban on all new trade or investment deals between Canada and Saudi Arabia. The countries conduct about 14 billion riyals or 5 billion Canadian dollars ($3.9 billion) in bilateral trade annually. The Saudi government has also reportedly moved to rescind scholarships to about 16,000 Saudi students who had been preparing to study at Canadian universities during the upcoming academic year, and the national carrier airline, Saudia, is canceling flights to Canada as of Aug. 13
The diplomatic storm was set off by public comments last week from Canadian Foreign Affairs Minister Chrystia Freeland, who criticized the Saudi detention of women's rights activists.
Why It Matters
With its strong reaction to the remarks, the Saudi government is sending a signal to the West: It will not tolerate outside criticism of what it considers to be an internal security matter. Riyadh steadfastly refuses to yield to external pressure over what it views as a national security issue, including the manner in which it limits the freedom of activists who defy government dictates. Some activists are pushing for the same policies that the government is pursuing, but that point is irrelevant to Riyadh, which wants to pursue reform on its own terms.
Though Saudi Arabia is aggressively seeking foreign financing, its moves against Canada could prove disruptive for some businesses and could chill broader investor sentiment. A similar situation followed German criticism in November 2017 of the Saudi attempt to pressure the Lebanese prime minister to align his government's policy with Saudi wishes. In the wake of that spat, German companies have found doing business in the kingdom considerably more difficult. Canadian investors are likely to cast a wary eye on future dealings in Saudi Arabia, even if the overt split in relations heals. The rift will not negate any existing business deals — including an agreement for a Canadian firm to deliver, then provide maintenance services for, light armored vehicles — underlining how the uproar for now represents more of a speed bump than a roadblock for the Canadian-Saudi relationship.
From the Canadian perspective, an emphasis on human rights, to varying degrees, will continue to be a feature of its political system. Those considerations make it likely that at some point, more expressions of concern will be made over Saudi human rights practices, putting further pressure on a strained relationship. Considering the German experience, there's a risk that Saudi Arabia could freeze out Canadian companies or investors altogether if the relationship grows more tempestuous.
While Saudi Crown Prince Mohammed bin Salman is championing economic and social reforms, including allowing more freedoms for women, he has also made it clear that the state, and not civil society, is in charge of legislating and regulating those freedoms. For Salman to retain his mandate for reform will require him to stand up to pressure from outside powers; that stance plays well with Saudi citizens. An acceptance of Saudi internal policy from the current White House has emboldened Saudi Arabia to push back against criticism from others, in part because it knows that leaders in Washington are less likely to speak out against its internal policies — or its actions against countries such as Canada.