This article originally appeared in Geopolitical Monitor.
By Stephen Nagy, January 12, 2026
A recent Economist article speculates that Canada is “hedging” against the United States by seeking deeper engagement with China. But this framing represents a fundamental misreading of both Canada’s strategic position, and the nature of contemporary great power competition.
Here’s the reality: diversifying economic relationships is prudent policy, but the notion Canada could meaningfully balance American pressure through Chinese partnership is strategically questionable and empirically unsound. In fact, Canada’s relationship with its southern neighbor runs far too deep, China presents an unreliable alternative, and Canada’s capacity for broader global engagement is limited.
A Relationship Greater than any Single Government
The scale and depth of the Canada-US bilateral relationship defy comparison. Over $900 billion in annual trade flows across the world’s longest undefended border. Integrated continental defense architecture—formalized through NORAD and deepened through decades of intelligence sharing—forged irreplicable institutional bonds. What’s more, hundreds of thousands of informal connections between businesses, universities, civil society organizations, and families transcend any single government’s policy preferences.
President Trump cannot change this.
Provincial and state governments collaborate on everything from environmental regulation to law enforcement. Supply chains for critical industries—particularly aerospace, automotive, and energy—have evolved over decades to maximize continental efficiency.
Attempting to “hedge” this relationship through Chinese partnership fundamentally misunderstands its strategic definition: hedging requires viable alternatives.
But Canada has no viable alternative to the United States for defense guarantees, intelligence cooperation, or market access at remotely comparable scale. This is not a value judgement, but an empirical observation about Canada’s options.
An Unreliable Partner
China’s pattern of economic coercion against trading partners should give any Canadian policymaker pause.
The 2018 detention of Michael Kovrig and Michael Spavor—held for nearly three years in apparent retaliation for Canada’s arrest of Huawei executive Meng Wanzhou—demonstrated Beijing’s willingness to use hostage diplomacy against a middle power. It’s part of a broader pattern.
Chinese trade restrictions against Canadian canola exports, imposed after Meng’s arrest, cost Western Canadian farmers hundreds of millions of dollars. Australia faced punitive tariffs on wine, barley, beef, and coal after calling for an investigation into COVID-19’s origins. South Korea faced Chinese tourism boycotts and restrictions on Korean cultural products following the deployment of the THAAD missile defense system. The Philippines and Vietnam both experienced Chinese economic pressure related to South China Sea disputes.
The pattern is consistent: when countries take positions China opposes, Beijing retaliates. For a country like Canada—with $86 billion in annual trade with China, but $762 billion with the U.S.—this asymmetry creates obvious vulnerabilities. China has demonstrated it will damage relationships worth hundreds of billions to achieve political objectives. A Canadian government betting on Chinese partnership as insurance against American pressure would be building on remarkably unstable foundations.
There are also serious concerns about foreign interference. Recent reports from the Canadian Security Intelligence Service (CSIS) have documented extensive Chinese interference in Canadian democratic processes, including the targeting of diaspora communities, intimidation of critics, and attempts to influence electoral outcomes. A 2024 report from a multi-party committee of Canadian Parliamentarians with top secret security clearance detailed systematic efforts by the People’s Republic of China to compromise Canadian institutions, prompting a subsequent public inquiry which raised similar concerns. These are documented threats to Canadian sovereignty that any strategic partnership would need to address.
That’s why the suggestion that Canadian academic and policy circles are widely considering a China hedge—as UBC professor Paul Evans suggests in the Economist article—overstates the actual debate. Individual scholars like Evans may advocate this, but the conversation remains much broader.
The Realities of Broader Engagement
Canada faces concrete challenges requiring immediate attention, but has limited resources to address them. Arctic sovereignty is critical as climate change opens new shipping routes and resource extraction possibilities. Recent coordination between Russia and China in Arctic waters underscores security implications. Canada’s ability to monitor and defend its Arctic territory requires substantial investment—that’s been deferred for years—in surveillance capabilities, naval assets, and infrastructure.
Addressing foreign interference requires moving beyond rhetoric to concrete measures: strengthening intelligence capabilities, enhancing political financing transparency, protecting diaspora communities from transnational repression, and developing robust frameworks for identifying and countering influence operations. CSIS has identified interference activities not just from China but also Russia, Iran, and others. Building resilience demands resources and sustained political commitment.
The Indo-Pacific presents opportunities for strategic engagement, but these should be targeted and realistic. Canada’s 2022 Indo-Pacific Strategy identified priority relationships with Japan, South Korea, ASEAN countries, India, and Pacific Island nations. These partnerships offer genuine opportunities—for trade diversification, security cooperation, and multilateral engagement—and don’t require betting on China as a hedge against the United States.
Latin America offers similar potential. Trade with Mexico has grown substantially under USMCA, and deeper relationships with Brazil, Chile, Colombia, and other regional economies could genuinely diversify Canadian commerce. The recently announced US National Security Strategy (NSS) explicitly recognizes Western Hemisphere cooperation as a priority. For Canada, that’s an opportunity for alignment with American strategic thinking rather than opposition.
Canada’s challenge isn’t finding new great power patrons. It’s redefining contemporary middle-power status. The normative agenda that has characterized much Canadian foreign policy—an emphasis on human rights, democracy promotion, climate activism, and identity politics—has delivered diminishing returns in Washington (and around the world). The NSS prioritizes concrete security commitments, economic reciprocity, and burden-sharing over normative alignment.
This doesn’t mean abandoning values. It means recognizing that Canadian influence in Washington derives from being an indispensable partner, not from moral suasion. Canada can most effectively advance its interests by demonstrating strategic value: defending Arctic sovereignty, contributing meaningfully to continental defense, addressing shared security threats, and removing domestic barriers to economic productivity.
A recent Senate committee report on Canada-Africa relations illustrates the risks of strategic overextension. Its recommendations span security, governance, trade, and diplomatic engagement across 54 countries. The ambition is admirable. The resources are missing. Canada maintains only 27 diplomatic missions in Africa with limited personnel. Rather than attempting to be “everywhere,” Canada could generate more impact through focused engagement.
The principle applies globally. Canada must make choices about where its contributions can genuinely make a difference in places where its interests are most directly engaged.
Realism over Wishful Thinking
Canada’s path forward doesn’t run through Beijing. North America’s structural integration, China’s demonstrated unreliability as a partner, and Canada’s limited global engagement resources all point toward the same conclusion: Canada should focus on managing the US relationship effectively, building resilience against foreign interference, defending Arctic sovereignty, and engaging strategically in regions where its interests are directly at stake.
This isn’t about abandoning trade with China or refusing diplomatic engagement. It’s about recognizing partnership and hedging as different concepts, requiring different levels of trust and strategic alignment. Canada can trade with China with these understandings: Beijing is not a viable alternative to Washington and pretending otherwise represents a costly strategic error.
The challenge for Canadian policymakers isn’t finding creative ways to balance between great powers. It’s accepting the constraints that geography, history, and power realities impose, and working effectively within them. That may be less intellectually satisfying than grand strategic gambits, but it has the considerable advantage of being grounded in how the world actually works.
Dr. Stephen Nagy is a professor of politics and international studies at the International Christian University in Tokyo, and a senior fellow at the Macdonald-Laurier Institute. His forthcoming book is titled Japan as a Middle Power State: Navigating Ideological and Systemic Divides.
