Canada was courting Saudi Arabia for billions in new business before ill-fated tweet
The federal government was actively seeking billions of dollars in new business opportunities in Saudi Arabia last spring, opportunities that abruptly dried up with a single tweet issued in August by Canada’s embassy in Riyadh.
Briefing notes and other documents obtained by Global News show that Francois-Philippe Champagne, then the international trade minister in the Trudeau government, met twice with the Saudi ambassador to Canada last spring to pursue new export opportunities in everything from education to agriculture.
The briefing note also put a number on the value to the Canadian economy of teaching an estimated 7,640 Saudi students at Canadian post-secondary institutions. Champagne was told that those Saudi students, including 1,000 doctors-in-training, their families and officials, were generating $1.2-billion a year to the economy.
But when the Canadian embassy in Riyadh issued a tweet in Arabic on Aug. 5 criticizing the Saudi human rights record, that business all but dried up. Saudi Arabia recalled most of those students, kicked Canada’s ambassador out of the country, recalled their own ambassador from Canada, and suspended all future commercial ties. Notably, the Saudis did not cancel a multi-billion-dollar contract to purchase armoured vehicles for its military from a London, Ont., manufacturer.
Canada, for its part, stood by its criticism.
But, on Aug. 8, the day after the Saudi government announced diplomatic war on Canada, Freeland’s office issued a directive, a copy of which was obtained by Global News, that all “public-facing communications” including tweets be submitted for review to her office before being released by the embassy. The end result is that the Twitter account operated by Canada’s embassy in Riyadh has all but been silenced. Just one tweet has been published by that account since the offending tweet and that was an English-language greeting on Eid Mubarak on Aug. 20.
The account, which has nearly 12,000 followers, had issued more than 1,500 tweets before that.
Prime Minister Justin Trudeau and Saudi Crown Prince Mohammed bin Salman, who effectively rules the kingdom, will both be in Buenos Aires this weekend for the annual G20 summit. It will be the first time the two men will have been in the same room since the diplomatic spat blew up.
Bin Salman will likely receive a cool reception from many Western leaders as a result of the October murder of journalist Jamaal Khashoggi in the Saudi consulate in Istanbul. Bin Salman, often referred to by his initials as M.b.S, is believed to have been aware of, if not the instigator, of the plans to kill Khashoggi, a suggestion dismissed by Saudi officials.
Some foreign policy experts believe it will fall to leaders like Trudeau and France’s Emmanuel Macron to stand up to violent autocracies like the one that bin Salman leads in Saudi Arabia. U.S. President Donald Trump has effectively absolved bin Salman in the murder despite the conclusions of his own intelligence agencies.
“It does mean that the leadership of the free world, so to speak, will rest with others in a forum like this,” said Thomas Wright, a senior fellow at the Brookings Institution in Washington. “One of the questions that I think will be raised is whether Prime Minister Trudeau will say anything about Saudi Arabia or about M.b.S, given Canada’s recent problems with Riyadh.”
“Trump is likely to sit on the sidelines,” said John Kirton, the head of the G20 Research Group based at the University of Toronto, who agrees it will be up to Trudeau, Macron, Merkel and a leader like India’s Narendra Modi to defend democracy, human rights and the rule of law.
There is little expectation, though, that Trudeau will use the summit to restart a relationship that, not even six months ago, was thought to be potentially profitable and lucrative.
A member of Trudeau’s office, speaking on background, told reporters Tuesday that Canada, for now, is focused, along with its allies, on “accountability” for the murder of Khashoggi.
But Canada had a much different view of Saudi Arabia seven months ago.
On April 4, Champagne spent 30 minutes on the phone with Saudi Ambassador Naif bin Bandar Al-Sudairi and would meet him in person on May 2 at the Ottawa headquarters of Global Affairs Canada. Improving trade ties was the top topic.
“Canada and Saudi Arabia enjoy strong bilateral commercial relations which have a potential to grow significantly,” Champagne was told in a briefing note prepared by Global Affairs Canada officials ahead of the phone meeting with Al-Sudairy. “Saudi Arabia is Canada’s most important two-way trading partner in the Middle East and North Africa Region.”
In 2017, Canada exported a record-high $1.45 billion worth of goods and services to Saudi Arabia while importing $2.62 billion.
WATCH: Freeland says Khashoggi affair is not ‘closed’ despite U.S. response
Champagne was told that Export Development Canada, a Crown corporation which facilitates exports to private sector entities abroad, and the Canadian Commercial Corporation (the CCC), which facilitates exports to foreign governments, have been “actively seeking new business” in Saudi Arabia.
The CCC facilitated the controversial contract between the Saudi military and General Dynamics Land Systems of London, Ont., for the export of light armoured vehicles.
But Global Affairs noted that there were, as of last April, about 60 Canadian companies active in Saudi Arabia accounting for about $130 million in direct foreign investment. That including SNC Lavalin, Barrick Gold, Bombardier Aerospace as well as Niagara College, Apotex, Tim Hortons and the law firm Black, Cassels, and Graydon.
“Even slowed Saudi spending continues to present significant opportunities for Canada,” the April briefing note for Champagne says.
The two countries created the Canada-Saudi Arabia Joint Economic Commission (JEC) in 1976 and the commission’s most recent meeting when Champagne met the ambassador had been held in Riyadh in March of 2016. As of last April, the two nations were looking forward to and planning another meeting of this commission in Canada this year. Not surprisingly, the events of August have led to the postponement of any such meeting.
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