Send this page to someone via email Amid a deepening diplomatic dispute, Saudi Arabia’s decision to sell off its Canadian assets in a fire sale could benefit investors outside the kingdom and have little impact on Canada’s economy, say experts. The Saudi central bank has instructed its overseas asset managers to sell Canadian equities, bonds and cash holdings “no matter the cost,” the Financial Times reported Wednesday. Managers are estimated to invest more than $100 billion worth of Saudi funds in global markets, according to the report. WATCH: Tensions between Saudi Arabia and Canada affecting international students Story continues below advertisement But this latest retaliation from Saudi Arabia could be beneficial for investors outside of the kingdom looking to pick up assets for cheap, said Rex Brynen, a political science professor at McGill University who specializes in Middle East politics. “Since it’s a fire sale, it’s the Saudis that will be losing money and other people are going to make a profit at their expense,” said Brynen. Tweet This Click to share quote on Twitter: "Since it's a fire sale, it's the Saudis that will be losing money and other people are going to make a profit at their expense," said Brynen. “You could snap up a Saudi-owned asset for fifty cents on the dollar.” Brynen said that while there could be some negative short-term economic effects — a lower dollar value, slumping stock prices or investment capital leaving Canada — Riyadh’s decision will mostly hurt Saudi-owned firms. “The Saudis are shooting themselves in the foot,” he said. “They seem perfectly willing to lose money and inconvenience their citizens in order to make a point.” “Canada seems to be an easy target to signal to rest of the world ‘you can’t criticize us.’” READ MORE: Is Canada being inconsistent about human rights concerns in Saudi Arabia? The Saudi-Canada feud began after Global Affairs Canada called for the “immediate release” of women’s rights activists Samar Badawi and Nassima al-Sadah. Canada is gravely concerned about additional arrests of civil society and women’s rights activists in #SaudiArabia, including Samar Badawi. We urge the Saudi authorities to immediately release them and all other peaceful #humanrights activists. — Foreign Policy CAN (@CanadaFP) August 3, 2018 Story continues below advertisement In response, Saudi Arabia’s Crown Prince Mohammed bin Salman expelled Canada’s ambassador, froze new trade and investment, suspended a student exchange program and halted flights by state-owned Saudi Arabian Airlines to Canada for what it called “blatant interference” in its domestic affairs. WATCH: U.S. State Dept. urges Canada, Saudi Arabia to resolve dispute 0:15 U.S. State Department urges Canada, Saudi Arabia to resolve dispute U.S. State Department urges Canada, Saudi Arabia to resolve dispute – Aug 7, 2018 On Wednesday, the kingdom suspended all medical treatment programs in Canada and looked to transfer Saudi patients out of the country. Saudi Arabia said there is no room for mediation on the escalating diplomatic spat and that Ottawa knows how to “fix its big mistake.” “There is nothing to mediate,” Foreign Minister Adel al-Jubeir told a news conference in Riyadh. “A mistake has been made and a mistake should be corrected.” Tweet This Click to share quote on Twitter: "There is nothing to mediate," Foreign Minister Adel al-Jubeir told a news conference in Riyadh. "A mistake has been made and a mistake should be corrected." READ MORE: Saudi Arabia says ‘nothing to mediate’ in dispute as reports emerge of selling Canadian assets Walid Hejazi, professor of international competitiveness at the University of Toronto, said the economic sanctions will have little effect on the Canadian economy as Saudi Arabia — Canada’s 20th largest trading partner — only represents roughly $4 billion in trade annually. Story continues below advertisement Canada and the U.S. trade roughly $2 billion worth of goods daily, Hejazi said. “This is a political statement on the part of the Saudis,” he said. “Their Canadians holdings are not large enough to have any meaningful impact.” Tweet This Click to share quote on Twitter: "This is a political statement on the part of the Saudis," he said. "Their Canadians holdings are not large enough to have any meaningful impact." Hejazi said the individuals travelling to and from the kingdom and companies looking to build business ties in the region will mostly be hurt by this move. READ MORE: Canada can easily replace Saudi Arabian crude oil, economist says The Saudi Grains Organization also announced it is halting purchases of wheat and barley from Canada, but it was unclear whether this move affected only new purchases or delivery on previously agreed contracts. According to Statistics Canada, the total amount of Canadian wheat sales to Saudi Arabia, excluding durum, was 66,000 tonnes in 2017 and 68,250 tonnes in 2016. Canadian barley sales totaled 132,000 tonnes in 2017. In 2015, the Canadian Wheat Board was taken over by the state-owned Saudi Agricultural and Livestock Investment Co. and U.S. grain company Bunge. Now known as G3 Ltd., the majority-controlled Saudi firm said it has no plans to change or reduce its purchases of Canadian crops. “It’s business as usual,” G3 vice-president Brett Malkoske told Reuters. The Saudi government has not said whether it will sell its stake in G3. Story continues below advertisement READ MORE: As Saudi-Canada feud escalates, here’s how axing armoured vehicle deal could hurt Trudeau in 2019 Chuck Penner, an analyst based in Winnipeg with LeftField Commodity Research, told Global News that if Saudi Arabia were to sell off its stake in G3 the impact on Canada would be “relatively seamless.” “We’ve bought and sold grain companies before and business continues to go on,” Penner said. “Even if that was included in the list of assets they want to sell, I don’t think it would have a huge impact.” “This is really a symbolic type of thing,” he said. “Canada won’t have any trouble selling its wheat and barley elsewhere.” Tweet This Click to share quote on Twitter: "This is really a symbolic type of thing," he said. "Canada won't have any trouble selling its wheat and barley elsewhere."<doc-sep>Saudi Arabia said on Sunday that it is ordering Canada's ambassador to leave the country and freezing all new trade and investment transactions with Canada in a spat over human rights. "We consider the Canadian ambassador to the Kingdom of Saudi Arabia persona non grata and order him to leave within the next 24 hours," Saudi Arabia's Foreign Ministry said on Twitter. #Statement | KSA through its history has not and will not accept any form of interfering in the internal affairs of the Kingdom. The KSA considers the Canadian position an attack on the KSA and requires a firm stance to deter who attempts to undermine the sovereignty of the KSA. —@KSAmofaEN This is quoted by the Saudi statement...which says the people involved were arrested on charges of “committing crimes that should be stopped” and that their rights were “assured” in the process https://t.co/cgVp6QTiZD —@NahlahAyed The ministry added that Saudi Arabia is recalling its ambassador to Canada. Both the Saudi and Canadian ambassadors were away on leave at the time of the announcement. The dispute appears to be over a tweet on Friday from Global Affairs Canada. "Canada is gravely concerned about additional arrests of civil society and women's rights activists in Saudi Arabia, including Samar Badawi. We urge the Saudi authorities to immediately release them and all other peaceful human rights activists," the tweet said. 'Unfortunate, reprehensible, and unacceptable' The Saudi Foreign Ministry called the use of "immediately release" in Canada's tweet "unfortunate, reprehensible, and unacceptable in relations between states." It dismissed Canada's characterization of the activists as "an incorrect claim" and said Canada's attitude was "surprising." #Statement | The Canadian position is an overt and blatant interference in the internal affairs of the Kingdom of #SaudiArabia and is in contravention of the most basic international norms and all the charters governing relations between States. —@KSAmofaEN "Any other attempt to interfere with our internal affairs from Canada, means that we are allowed to interfere in Canada's internal affairs," it said. Saudi state television later reported that the Education Ministry was coming up with an "urgent plan" to move thousands of Saudi scholarship students out of Canadian schools to take classes in other countries. The sudden and unexpected dispute bore the hallmarks of Crown Prince Mohammed bin Salman, Saudi Arabia's 32-year-old future leader, whose recent foreign policy exploits include the war in Yemen, the boycott of Qatar and Lebanese Prime Minister Saad Hariri's surprise resignation broadcast during a visit to the kingdom. Hariri later rescinded the resignation, widely believed to be orchestrated by Riyadh, and returned to Beirut. 'Canada will always stand up for ... human rights' A spokesperson for Foreign Affairs Minister Chrystia Freeland issued a brief response to the Saudi complaint on Sunday evening. "We are seriously concerned by these media reports and are seeking greater clarity on the recent statement from the Kingdom of Saudi Arabia," said Marie-Pier Baril. "Canada will always stand up for the protection of human rights, very much including women's rights, and freedom of expression around the world. Our government will never hesitate to promote these values and believes that this dialogue is critical to international diplomacy." Very alarmed to learn that Samar Badawi, Raif Badawi’s sister, has been imprisoned in Saudi Arabia. Canada stands together with the Badawi family in this difficult time, and we continue to strongly call for the release of both Raif and Samar Badawi. —@cafreeland Saudi Arabia said it is also freezing all new trade and investment transactions with Canada and "reserves its right to take further action." Saudi Arabia is one of Canada's largest export markets in the region, and some 10 per cent of Canadian crude oil imports come from Saudi Arabia. It said it will not accept any form of interference in its internal affairs and considers the Canadian position "an attack" requiring a firm stance to deter "attempts to undermine the sovereignty" of Saudi Arabia. In neighbouring United Arab Emirates, Minister of State for Foreign Affairs Anwar Gargash said Monday on Twitter that his country stands with Saudi Arabia "in defending its sovereignty." Bahrain's foreign minister made similar comments in support of Riyadh. Crackdown on human rights Amnesty International has said Badawi, the sister of jailed blogger Raif Badawi, was recently detained along with Nassima al-Sada, another prominent female activist. The human rights group's Middle East research director described the arrests as part of a larger crackdown on human rights in Saudi Arabia. Jackie Hansen, a gender rights campaigner for Amnesty International Canada, said last Thursday that the circumstances of the arrests were still unclear and there was no news of any charges. Badawi's brother was arrested in Saudi Arabia in 2012 and later sentenced to 1,000 lashes and 10 years in jail for criticizing clerics. 50 lashes He received 50 lashes in January 2015 during a public flogging but is not believed to have received any further corporal punishment since then. His wife,​ Ensaf Haidar, and three children live in Quebec and became Canadian citizens last month. Samar Badawi, centre, is seen with Hillary Clinton and Michelle Obama in 2012. (Gary Cameron/Reuters) Freeland said on social media last Thursday that she was "alarmed" to hear of Samar Badawi's arrest. "Canada stands together with the Badawi family in this difficult time, and we continue to strongly call for the release of both Raif and Samar Badawi," she wrote on Twitter. Germany recently targeted ​Bessma Momani, a political science professor at the University of Waterloo, believes the apparent diplomatic moves by Riyadh were about more than the Badawi case. "I think one has to stand back and see that there's been a lot of heat on Saudi Arabia, particularly its treatment of civil society actors and and human rights activities," she said. "I think Canada is literally made to be an example." We’ve seen a lot of support for Saudi dissidents in the UK, Canada, the US Congress, & others. But Canada is easier to cut ties with than the rest. There isn’t a strong bilateral trade relationship & poking Trudeau government likely resonates with Saudi’s hawkish regional allies. —@b_momani<doc-sep>Send this page to someone via email As Saudi Arabia continues to volley fresh restrictions against Canada, there’s notable silence from one key group of voices — Canada’s allies. Since the Middle Eastern kingdom launched the dispute on Sunday evening over tweets sent the week prior, Saudi Arabia has recalled its ambassador, expelled Canada’s ambassador, frozen new business and trade, ordered Saudi students studying in Canada to go somewhere else, ordered Saudi citizens seeking medical care in Canada to go somewhere else, blacklisted Canadian wheat and barley, and ordered the asset managers of their central bank and pension funds to dump Canadian assets “no matter the cost.” READ MORE: Is Canada a ‘whipping boy’ for Saudi Arabia? Why the kingdom picked a fight over a tweet And among it all, the only response from Canada’s two closest allies — the U.S. and U.K. — has been to call both sides close partners and urge restraint. Story continues below advertisement So why the silence? Like so many things in politics, it all boils down to the money, said one expert. WATCH BELOW: Diplomatic feud intensifies between Canada and Saudi Arabia 2:40 Diplomatic feud intensifies between Canada and Saudi Arabia Diplomatic feud intensifies between Canada and Saudi Arabia – Aug 7, 2018 “There is an attempt by the Saudis to create some fear and rattle some of those Western governments into not supporting Canada because they may be cut out or shut out from some potential Saudi economic deals and the big boom that it’s undertaking,” said Bessma Momani, a professor at the University of Waterloo specializing in Saudi relations and a senior fellow at the Centre for International Governance and Innovation. “Saudi Arabia is the largest weapons purchaser in the world, so any company or country in the world that sells arms, as does Canada, is likely to be looking into how this is going to affect bilateral trade ties.” Story continues below advertisement READ MORE: Saudi Arabia says ‘nothing to mediate’ in dispute as reports emerge of selling Canadian assets The dispute stems from what Momani called the “brash” decision by Saudi Arabia to respond to criticism of its arrest of women’s rights activists with a campaign of retaliation meant to send a warning to more powerful Western countries. And it has not gone unnoticed that the same countries Canada has fought with and died alongside over the last century are keeping their mouths shut rather than speak out against the attacks. The Brits and the Trumpians run for cover and say “we’re friends with both the Saudis and the Canadians” – thanks for the support for human rights, guys, and we’ll remember this one for sure. Saudi reaction is completely over the top. #dontshootthemessenger — Bob Rae (@BobRae48) August 7, 2018 There have been no tweets posted from the U.K. Foreign Office account about the spat. In its statement to reporters, the office offered just three lines that urged restraint and described both Canada and Saudi Arabia as “close partners.” READ MORE: U.S. refuses to get in the middle of Canada-Saudi dispute as Canada looks for allies The U.S. has also refused to get involved and called both countries close allies. “Both sides need to diplomatically resolve this together. We can’t do it for them; they need to resolve it together,” U.S. State Department spokeswoman Heather Nauert said Tuesday. “Maybe we’re both allies but we’re supposed to be your closest ally,” Momani said. Tweet This Click to share quote on Twitter: "Maybe we're both allies but we're supposed to be your closest ally," Momani said. Story continues below advertisement “Putting us both on the same standing is something a lot of people are scratching their heads about, but perhaps not uncommon with the Trump administration and his disdain for our prime minister.” Relations between U.S. President Donald Trump and Prime Minister Justin Trudeau have been testy since Trump went on a Twitter rant bashing the prime minister for contradicting him during the closing press conferences of the G7 Summit in Charlevoix, Que., in June. With a normal American administration: 1) Saudi Arabia wouldn't dream of breaking ties with Canada 2) Washington would be the obvious mediator https://t.co/Ts2LOgQsOu — Perry Cammack (@perrycammack) August 7, 2018 Those kinds of attacks on traditional allies may have had a role in empowering Saudi Arabia to believe it can carry out such actions freely. “Trumpism has consequences: a license for the reckless to act recklessly,” wrote Thomas Juneau, an assistant professor at the University of Ottawa specializing in Middle East relations. As the dust settles, take-aways from the Canada-Saudi tiff -This is mostly about Saudi, not Canada: send a message that criticism will be punished -Saudi will increasingly pay the price of its overreaching -Trumpism has consequences: a license for the reckless to act recklessly — Thomas Juneau (@thomasjuneau) August 8, 2018 The European Union also refused to get involved. A spokesperson was quoted by the New York Times as saying, “We don’t comment on bilateral relations” and that “we are in favor of a dialogue.” Here's the European Union's courageous response to the Canada-Saudi spat over human rights: "we don't comment on bilateral relations…we are in favor of a dialogue." Really, @MajaEUspox @federicamog? https://t.co/lONG7V7TeQ — Roland Paris (@rolandparis) August 7, 2018 So far, the only high profile foreign official to come to Canada’s defence has been U.S. Senator Bernie Sanders. Story continues below advertisement He posted a tweet on Monday calling Saudi Arabia’s reaction “outrageous” and defending Canada’s criticism of the arrest of women’s rights activists. One of those, Samar Badawi, is the sister of imprisoned dissident blogger Raif Badawi, whose wife lives in Quebec and is a Canadian citizen. This is an outrageous move. It's entirely legitimate for democratic governments to highlight human rights issues with undemocratic governments. We must continue to do so. The US must be clear in condemning repression, especially when done by governments that receive our support. https://t.co/M0sLs2iyGg — Bernie Sanders (@SenSanders) August 6, 2018 The question now will be whether the Canadian government can contain the situation and stop things from escalating further.<doc-sep>It's a stretch for Saudi Arabia to accuse Canada of meddling in its affairs while it wages war on neighbouring Yemen, says former defence analyst Thomas Juneau. Saudi Arabia said it is ordering Canada's ambassador to leave the country, freezing all new trade and investment transactions with Canada, and moving thousands of Saudi scholarship students out of Canadian schools. The move comes after Global Affairs Canada issued a statement on Twitter demanding the Saudis release imprisoned blogger Samar Badawi and other jailed human rights activists. Juneau, an international affairs professor at the University of Ottawa, spoke to As It Happens guest host Matt Galloway about the state of relations between Canada and the Saudis. Here is part of their conversation. Why has Saudi Arabia acted the way it has now? We have to be very clear that what Canada said late last week was perfectly normal. It's the kind of thing that this country or other Western countries say about Saudi Arabia and other non-democratic countries literally every day. So why now? I would identify two main reasons. Since King Salman came on the throne in 2015 and his son Crown Prince Mohammed bin Salman emerged as really the main player in Saudi Arabia, the country's foreign policy has become much more aggressive, much more ambitious, much more assertive. The other reason is more specific to Canada-Saudi relations. Canada-Saudi relations have often been portrayed in the media in the last two, three, four years as quite good because of the sale of LAVs, the light armoured vehicles, for $15 billion. In practice, in the last two years, relations have grown increasingly tense because Saudi Arabia viewed the LAV deal really as an investment ... to deepen relations with each other — deepen trade, deepen academic exchanges, scientific exchanges, security and defence co-operation and so on. But that didn't happen, mostly because the Liberals really didn't want to be seen as deepening co-operation with such a brutal dictatorship. That really frustrated the Saudis a lot and we just saw that boil over over the weekend. Ensaf Haidar stands next to a poster for a book of articles written by the imprisoned Saudi blogger Raif Badawi, Haidar's husband. (Paul Chiasson/Canadian Press) It was referred to in the response from Saudi Arabia as Canada meddling in another nation's internal affairs. What is Saudi Arabia's ground for making a comment like that? If you take just a couple small steps back, Saudi Arabia is leading an extremely brutal war in its neighbour, in Yemen, killing tens of thousands of people and completely ravaging the country. It's imposed an embargo on Qatar, its neighbour. It literally kidnapped and took as a hostage the Lebanese prime minister late last year. So if you want to talk about meddling, right, Saudi Arabia meddles far, far more than Canada ever has. What do you think the effect of the actions of Saudi Arabia is going to have? One thing that is now pretty clear is that about 15,000 Saudi students who were studying in Canada, in universities and colleges, will have to go study elsewhere. Beyond that, you know, economically, I still have to be convinced that the cost to Canada will be large. Two-way trade between Canada and Saudi Arabia fluctuates between $3-$4 billion per year. That's not a lot. That's two days of Canada-U.S. trade. The one big question on the economic front is: What is going to happen to the light armoured vehicles? ... As of right now, we don't know what the status of that deal is. If that is cancelled, that is, on the one side, you know, from a moral perspective, good for Canada because we're not selling weapons to a very brutal dictatorship. Economically, that's a cost because that's $15 billion that will not go into the Canadian economy. Can you do both? Can you have a trade deal with a country that's worth $15 billion, that's going to create jobs here in Canada, but also criticize them on the human rights record? Morally, it's a bit repugnant and there are very good arguments not to do that. But, in practice, Canada, European countries, the U.S. have been selling weapons to non-democracies for decades. So, until now, it was doable. A still from a video obtained by Radio Canada International shows a column of light armoured vehicles like those produced by General Dynamics Land Systems Canada being deployed by Saudi forces in a crackdown against Shia militants in the kingdom’s Eastern Province. (Handout) It seems unlikely at this point that the United States is going to follow Canada's lead and call Saudi Arabia out for its human rights abuses. Does that, in some ways, give Saudi Arabia that more leeway here? The nature of the relationship between Trump and Saudi Arabia, what role did that have in encouraging maybe the Saudi action since yesterday? To be honest, I don't know what the answer to that is. Next time Canada has a dispute with another country — and one that matters more than Saudi Arabia — will the U.S. have our back? Will the U.S. be there to support us, as it would have been until 2016? When it matters more, that's where it could be more problematic. Written by Sheena Goodyear. Produced by Jeanne Armstrong.<doc-sep>
Send this page to someone via email It started with a tweet over human rights and now the feud between Saudi Arabia and Canada has escalated into one of the biggest diplomatic rifts in years between the two nations. Saudi Arabia has kicked out the Canadian ambassador, plans to pull out thousands of students and medical patients from Canada and is suspending Saudi state airline flights to Toronto. And Prime Minister Justin Trudeau is not backing down. “It’s very harsh diplomatic measures,” said Aurel Braun, a professor of political science and international relations at the University of Toronto. “This is an all-out confrontation short of a military conflict because it’s breaking a link in the diplomatic embassy.” Story continues below advertisement As the feud continues to balloon, here’s everything you need to know about it. WATCH: No apology from Trudeau on Canada’s dispute with Saudi Arabia 2:22 No apology from Trudeau on Canada’s dispute with Saudi Arabia No apology from Trudeau on Canada’s dispute with Saudi Arabia – Aug 8, 2018 How did it start? The diplomatic dispute began last week after Foreign Affairs Minister Chrystia Freeland tweeted concerns about the news that several social activists had been arrested in Saudi Arabia, including Samar Badawi, a women’s rights activist who is the sister of imprisoned dissident blogger Raif Badawi, whose wife is a Canadian citizen and lives in Quebec. Canada is gravely concerned about additional arrests of civil society and women’s rights activists in #SaudiArabia, including Samar Badawi. We urge the Saudi authorities to immediately release them and all other peaceful #humanrights activists. — Foreign Policy CAN (@CanadaFP) August 3, 2018 On Aug. 2, Freeland called for the release of the prisoners, and a day later, her department tweeted further criticism and called for the “immediate release” of Badawi. Saudi Arabia has consistently been flagged as one of the worst violators of human rights by groups like Human Rights Watch and Amnesty International. Story continues below advertisement How did Saudi Arabia react? The ultraconservative kingdom did not take the tweet lightly. In a series of angry tweets on Sunday, the Saudi foreign ministry criticized Canada’s “negative and surprising attitude” and called the country’s position “an overt and blatant interference in the internal affairs of the Kingdom of #SaudiArabia.” #Statement | The negative and surprising attitude of #Canada is an entirely false claim and utterly incorrect. — Foreign Ministry 🇸🇦 (@KSAmofaEN) August 5, 2018 “Canada has made a mistake and needs to fix it,” Foreign Minister Adel al-Jubeir said Wednesday. “The ball is in Canada’s court.” In a steady string of retaliatory measures, Saudi Arabia’s foreign ministry expelled Canada’s ambassador and suspended all business and trade between the two countries. READ MORE: How Saudi Arabia selling Canadian assets could affect our economy Story continues below advertisement The nation is also ending thousands of Saudi scholarship programs in Canada, arranging for all Saudi patients in Canadian hospitals to be transferred out of the country, blacklisted Canadian wheat and barley and ordered the asset managers of their central bank and pension funds to dump Canadian assets “no matter the cost.” WATCH: Saudi Arabia restricts Canada trade, recalls ambassador 1:11 Saudi Arabia restricts Canada trade, recalls ambassador Saudi Arabia restricts Canada trade, recalls ambassador – Aug 6, 2018 Why the quick, harsh reaction? Saudi Arabia has always been hypersensitive to criticism of human rights, according to Braun. For example, in 2015 Sweden criticized the kingdom’s human rights record, and as a result, Saudi Arabia took harsh diplomatic measures and expelled Sweden’s ambassador. But Braun said the kingdom’s reaction to Canada seems to be more severe. Story continues below advertisement “Maybe the ruling family wants to make an example of Canada and send a message internationally, that Saudi Armada will extract a high cost for those who interfere in domestic affairs,” he said. The nation also has a young new crown prince in power, Mohammed bin Salman, who is taking steps forward to modernize the country. “By contrast to the old regime, the country believes it is modernizing, such as allowing women to drive, although this may seem minute to us,” Braun explained. “They see themselves as trying to engage in reform, but they are not being rewarded for it, instead Canada is shaming them.