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8 Aug, 2018 13:08

Saudi Arabia to dump Canadian assets 'no matter the cost' as diplomatic rift spirals – report

Saudi Arabia to dump Canadian assets 'no matter the cost' as diplomatic rift spirals – report

Saudi Arabia is selling off Canadian securities in response to Ottawa’s criticism of the arrest of a female activist, the Financial Times reports. Riyadh says it's ready to take the step despite possible financial losses.

According to the newspaper, Saudi Arabia’s overseas asset managers were told to dump Canadian equities, bonds and cash holdings “no matter the cost.” Saudi Arabia is not a major investor in Canada, according to the FT source, but the Kingdom wants to send a strong signal to authorities in Ottawa.

The diplomatic rift between the two countries began after Canadian Foreign Minister Chrystia Freeland demanded the release from prison of Saudi women’s rights activist Samar Badawi, who has family in Canada.

Riyadh said the Canadian demand was “a blatant interference in the Kingdom’s domestic affairs, against basic international norms and all international protocols.”

“The Kingdom views the Canadian position as an affront to the Kingdom that requires a sharp response to prevent any party from attempting to meddle with Saudi sovereignty,” according to a statement by the Saudi Foreign Ministry.

On Tuesday, Saudi Arabia's national airline Saudia halted all direct flights to and from Toronto following Canada’s intervention. Toronto is the only Canadian destination Saudia serves.

Saudi Arabia has ordered all Canadian grain purchases to be stopped, adding it will no longer buy Canadian-origin grains. The Saudi government has also stopped all medical treatment programs in Canada and moved Saudi scholarship recipients to other countries. The Canadian dollar reacted negatively to the news, declining 0.12 percent against the US dollar to just under 0.77 cents.

Saudi Arabia has already expelled the Canadian ambassador.

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