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Saudi Arabia rules out mediation in Canada row, Trudeau stands firm

Saudi Arabia said on Wednesday there was no room for mediation in the kingdom's deepening diplomatic dispute with Canada over human rights, adding that Ottawa knew what it needed to do to "fix its big mistake".


Reuters Last Updated at 09 Aug 2018, 02:08 IST Saudi Arabia

Saudi Arabia said on Wednesday there was no room for mediation in the kingdom's deepening diplomatic dispute with Canada over human rights, adding that Ottawa knew what it needed to do to "fix its big mistake".

Canadian Prime Minister Justin Trudeau praised Saudi Arabia for having made some progress on civil rights but made clear he would continue to press Riyadh about his government's concerns.

Saudi Arabia on Sunday froze new trade with Canada and expelled the Canadian ambassador in retaliation for a call from Ottawa to free arrested Saudi civil society activists. It also ended state-backed educational and medical programmes in Canada.

"There is nothing to mediate. A mistake has been made and a mistake should be corrected," Foreign Minister Adel al-Jubeir told a news conference in Riyadh.

Trudeau told reporters in Montreal that Canadian Foreign Minister Chrystia Freeland had held a long conversation with her Saudi counterpart on Tuesday, but gave no details.

"We don't want to have poor relations with Saudi Arabia. It is a country that has great significance in the world, that is making progress in the area of human rights," he said.

"But we will continue underscoring challenges where and when they exist, in Saudi Arabia and elsewhere," he continued.

On Friday, Canada expressed concern over the arrests of activists in Saudi Arabia, including prominent women's rights campaigner Samar Badawi. A number of women's rights activists, who campaigned for the right to drive and an end to the kingdom's male guardianship system, have been targeted in a government crackdown in recent months, human rights' groups have said.

Jubeir said the kingdom was still "considering additional measures" against Canada, but did not elaborate. Canadian investments in Saudi Arabia were still ongoing and would not be affected by the dispute, he said.

The Financial Times, citing unidentified sources, reported the Saudi central bank and state pension funds had instructed their overseas asset managers to dispose of their Canadian equities, bonds and cash holdings "no matter the cost".

The central bank did not immediately respond to a Reuters query for comment. Canada's foreign ministry said it was seeking clarity from the Saudi Arabian government.

A source at a Saudi bank told Reuters the bank was contacted by the central bank on Wednesday asking for information about all their Canadian exposure – investments in Canada and foreign exchange positions.

Canada's share of Saudi Arabia's foreign currency reserves would likely not be enough by itself to hurt the dollar, said Mark McCormick, North American Head of FX Strategy at TD Securities.

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Since rising to power in 2015, Crown Prince Mohammed bin Salman has courted Western allies to support his reform plans, offering billions of dollars of arms sales and promising to fight radicalism in the kingdom.

But the row threatens to slow Riyadh's foreign investment drive, a campaign already unsettled by a series of assertive foreign policy initiatives by the top oil exporter.

"Saudi Arabia simply cannot afford to alienate any other sections of the global community in the midst of its unpopular military engagement in Yemen, its indirect confrontation with Iran," commentator Jamal Khashoggi wrote in the Washington Post.

The kingdom has taken several measures to punish Ottawa.

In addition to the trade freeze, Riyadh has stopped sending patients to Canadian hospitals, told Saudi trainee doctors in Canada to come home, suspended educational exchanges, and moved Saudi scholars to other countries. Saudi's state airline said it was suspending flights to and from Toronto.

Saudi Arabia's main state wheat buying agency told grains exporters it will no longer accept Canadian-origin grains in international tenders, European traders said.

Bilateral trade between Canada and Saudi Arabia is worth nearly $4 billion a year. Canadian exports to Saudi Arabia were about $1.12 billion in 2017, or 0.2 percent of the total value of Canadian exports.

On Tuesday, Reuters reported that Canada planned to seek help from United Arab Emirates and Britain to defuse the row.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)


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