This article originally appeared in the Japan Times.
By Stephen Nagy, June 12, 2025
Recently, Canada’s first ministers expressed strong support for trade diversification and re-engagement with key global markets — including China. Before going any further, Ottawa needs to come to its senses and scrutinize this potential pivot.
This renewed enthusiasm for economic rapprochement with Beijing is deeply concerning. China has shown a clear track record of economic bullying and political intimidation toward Canada in recent years, particularly when former Prime Minister Justin Trudeau ran the show in Ottawa.
The first ministers’ statement reflects a pragmatic, if anxious, response to the looming trade threats from the Trump administration. Facing potential tariffs and economic disruption from its largest trading partner, Canada’s provincial and federal leadership appears to be seeking insurance through market diversification.
This objective is sound in principle, but the specific emphasis on re-engagement with China represents a problematic case of strategic amnesia about Beijing’s record of malevolent treatment of Canada.
The attempt to normalize trade relations with China on the heels of Beijing’s pattern of economic coercion bears an uncomfortable resemblance to a domestic abuse scenario — where a victim returns to their abuser out of financial necessity or misplaced hope that past behavior won’t recur. It’s a stark analogy, but it accurately captures the power dynamics and cyclical nature of China’s diplomatic engagement with middle powers like Canada when core interests are perceived to be at stake.
Make no mistake. Japan, Australia, the EU and South Korea also follow this pattern.
In Canada’s case, the most egregious example of China’s coercive diplomacy was the arbitrary detention of Canadian nationals Michael Kovrig and Michael Spavor for nearly 1,000 days — a textbook case of hostage diplomacy in retaliation for the lawful detention of Huawei executive Meng Wanzhou on a U.S. extradition request.
This was not merely a diplomatic disagreement, but state-sanctioned hostage-taking designed to break Canada’s resolve and commitment to its legal obligations and alliance partnerships. Beijing’s willingness to weaponize the freedom of Canadian citizens to achieve political objectives shows an utter disregard for human rights and the rule of law — principles Canada claims to uphold in its foreign policy.
Simultaneously, China deployed targeted economic sanctions against Canadian agricultural exports. The sudden suspension of canola imports from Canada’s largest producers in early 2019 — ostensibly for “pest concerns” that conveniently emerged only after Meng’s detention — cost Canadian farmers an estimated $2.7 billion. Similar restrictions on Canadian pork and beef imports followed, with China demonstrating how quickly it could transform market access into a geopolitical weapon. These measures were calibrated to inflict maximum economic pain while maintaining plausible deniability about their retaliatory nature.
More recently, the shocking execution of four Canadians on drug-related charges, despite diplomatic appeals for clemency, further illustrates Beijing’s willingness to disregard Canadian humanitarian concerns. While these cases involve individuals convicted under Chinese law, the timing and handling of these executions amid bilateral tensions cannot be dismissed as coincidental, especially given China’s opaque judicial system and selective enforcement patterns.
Perhaps most insidious has been China’s documented interference in Canada’s democratic processes. Initial findings and testimony from the ongoing Foreign Interference Commission have revealed systematic efforts by Chinese diplomatic missions to influence electoral outcomes, intimidate Chinese-Canadian communities and manipulate media narratives — all direct violations of Canada’s sovereignty. These operations weren’t isolated incidents, but part of a comprehensive strategy to shape Canada’s political environment to better serve Beijing’s interests. That Canadian leaders would contemplate enhanced economic engagement without resolving these sovereignty violations signals dangerous weakness in the country’s democratic resilience.
Proponents of renewed engagement will argue that economic pragmatism demands working with China despite these challenges. They’ll note that China remains one of Canada’s top trading partners after the U.S., representing significant export opportunities at a time when American protectionism threatens its northern neighbor’s economic stability. This argument, while superficially compelling, fails to acknowledge how economic dependence enables precisely the type of coercive leverage China has repeatedly demonstrated willingness to exercise.
The comparison with U.S.-Canada relations is telling. While U.S. President Donald Trump’s tariffs are a serious challenge to Canadian prosperity, the fundamental nature of the relationship differs dramatically from that with China. America and Canada share not only an extensive and deeply interwoven economic relationship representing nearly 75% of Canada’s total trade, but also deeply integrated supply chains, shared values and institutional connections that transcend any single administration. The thousands of cross-border business relationships, family ties and cultural affinities create resilience that simply doesn’t exist in the China-Canadian context.
Moreover, while American protectionism operates primarily through predictable, if sometimes capricious, policy mechanisms, China’s economic coercion is deliberately opaque, deniable and linked to political compliance rather than economic interests. When the Trump administration slapped aluminum and steel tariffs during USMCA negotiations, Canada responded through established dispute resolution channels and proportionate countermeasures — options that prove largely ineffective against China’s more sophisticated forms of economic bullying.
The first ministers’ emphasis on trade diversification as a strategy is fundamentally sound. Canada’s overwhelming dependence on the U.S. market creates vulnerability that prudent policy should address. Yet diversification should focus on reliable partners who respect consistent rules of economic engagement — markets like the European Union, members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, India and emerging economies in Africa and Latin America. These relationships may lack China’s market scale but offer more sustainable and predictable trade environments without the political risk premium Beijing demands.
If Canada, nonetheless, determines that economic engagement with China remains necessary, it must approach this relationship with clear-eyed realism rather than optimistic amnesia.
This would require several strategic adjustments: first, developing robust economic security tools to screen investments and protect critical supply chains; second, coordinating China policy closely with like-minded partners to prevent isolation and exploitation; third, establishing clear red lines regarding political interference and human rights; and fourth, investing in economic resilience measures that reduce vulnerability to coercion.
The fundamental challenge for Canadian policymakers is that China has demonstrated it does not separate economics from politics — every trade relationship serves broader strategic objectives. When Canada’s first ministers express enthusiasm for renewed engagement without acknowledging this reality, they risk repeating a cycle of exploitation where momentary economic gains come at the cost of long-term strategic vulnerability.
As the nation navigates the undeniable challenges posed by American protectionism, it must avoid the fallacy that China represents a comparable alternative partner. Despite Trump’s transactional approach to alliance management, the U.S.-Canada relationship remains anchored in shared democratic values, geographic proximity and institutional frameworks that provide guardrails against the worst impulses of any administration. These fundamental characteristics simply do not exist in Ottawa’s relationship with Beijing.
Canadian leaders must recognize that while diversification represents sound strategy, reconciliation with an unrepentant economic abuser constitutes strategic malpractice. The path forward requires neither naive engagement nor hostile decoupling, but rather a principled, resilient approach that prioritizes Canada’s long-term sovereignty and security over short-term market access.
Only by learning from recent history rather than conveniently forgetting it can Canada craft a China policy worthy of its values and interests.
Stephen R. Nagy is a professor of politics and international studies at the International Christian University in Tokyo, a senior fellow at the MacDonald Laurier Institute, a senior fellow at the Asia Pacific Foundation of Canada and a visiting fellow with the Japan Institute for International Affairs
