Commentary
Canada’s newly released national security strategy recognizes that national security extends beyond military defence into economic security, critical infrastructure, financial systems, and technological sovereignty. Yet the document contains a conspicuous omission. China, repeatedly identified by Canada’s intelligence agencies as a principal source of foreign interference, espionage, and economic security threats, is not mentioned by name.
Instead, the strategy emphasizes Canada’s vulnerabilities arising from economic dependence on the United States, employing language concerning sovereignty, strategic autonomy, and coercion more commonly associated with adversarial state behaviour.
Reducing Canada’s exposure to unpredictable American trade policies is a legitimate objective. However, economic disagreements between allies should not be confused with deliberate strategic subversion by hostile state actors.
Canada’s 2022 Indo-Pacific Strategy explicitly characterized China as an increasingly disruptive global power seeking to reshape the international order. The 2024 defence policy, “Our North, Strong and Free,” similarly identified China’s military expansion and coercive conduct as significant challenges.
Canadian intelligence assessments have been equally explicit. The Canadian Security Intelligence Service has identified China, Russia, Iran, and other states as perpetrators of foreign interference and espionage targeting Canadian institutions, businesses, and individuals.
The government’s reluctance to identify these actors in its overarching strategy raises an important question: How can Canada prioritize national security resources without clearly identifying the sources and mechanisms of its most consequential threats?
The strategy nevertheless represents progress in recognizing the changing character of contemporary conflict.
Hybrid warfare increasingly operates below the threshold of conventional armed confrontation. Adversaries exploit commercial relationships, political influence, financial networks, cyber vulnerabilities, and institutional weaknesses to advance strategic objectives without triggering traditional military responses.
Regimes such as the Chinese Communist Party often use economic activity as instruments of coercion. Foreign investment may create dependencies in critical sectors. Illicit financial networks can penetrate legitimate markets, while intelligence operations exploit academic institutions, emerging technologies, and commercial supply chains.
This convergence of commercial networks and transnational organized crime creates vulnerabilities that conventional security frameworks struggle to assess.
Canada’s experience with transnational money laundering illustrates this challenge.
What initially appears to be financial misconduct can extend into real estate, political influence, regulatory integrity, and international financial relationships. Where illicit capital intersects with foreign state interests, the consequences can extend beyond criminality into national security.
Similar vulnerabilities exist across ports, critical minerals, telecommunications, energy infrastructure, and advanced technologies.
The central concern is not simply foreign ownership. It is whether ownership structures, financing arrangements, supply-chain dependencies, or political relationships create opportunities for intelligence collection, coercion, or strategic disruption.
These risks also expose weaknesses in corporate governance.
Boards and executives increasingly confront threats that do not fit traditional enterprise risk frameworks. State-sponsored economic coercion frequently develops through ambiguous indicators that appear commercially routine until strategic dependencies become entrenched.
Recognizing these threats requires intelligence-informed governance, stronger beneficial ownership transparency, effective financial enforcement, and improved cooperation between security agencies and private-sector institutions.
The consequences extend well beyond Canada.
China’s economic coercion and cyber espionage affect allied security throughout the Indo-Pacific. Russian sabotage and influence operations challenge European resilience, while Iranian-linked networks and transnational repression create additional concerns across Western democracies.
Within NATO and the Five Eyes intelligence partnership, national vulnerabilities can become collective security liabilities. Weak financial enforcement, compromised infrastructure, or inadequate counterintelligence capabilities in one jurisdiction can create opportunities for hostile actors across interconnected allied systems.
Canada’s relationship with the United States must be considered within this broader strategic environment.
American tariffs, economic nationalism, and unilateral policy decisions have exposed genuine Canadian vulnerabilities. Greater diversification and domestic industrial capacity are reasonable responses.
However, disputes over trade, market access, and defence burden-sharing are fundamentally different from clandestine interference, espionage, and state-directed economic subversion.
Canada and the United States remain deeply integrated through NORAD, NATO, intelligence cooperation, and continental defence. Political disagreements do not eliminate the strategic foundations of that relationship.
Indeed, exploiting divisions between democratic allies is itself an established objective of hostile influence operations.
The new strategy’s commitments to stronger intelligence capabilities, financial crime enforcement, and national resilience are welcome. Yet institutional improvements require more than additional funding or organizational restructuring.
Canada needs clearer mechanisms for identifying hybrid threats, integrating fragmented intelligence, and regulatory information, and translating strategic assessments into timely decisions.
It also needs a coherent hierarchy of threats.
Strategic ambiguity may provide diplomatic flexibility, particularly when governments seek to preserve commercial relationships with countries presenting significant security concerns. However, ambiguity carries consequences for intelligence prioritization, institutional accountability, and public understanding.
Canada can maintain pragmatic commercial relations with China while acknowledging the security challenges associated with the Chinese Communist Party’s intelligence, political, and economic activities. These objectives are not mutually exclusive.
The government’s strategy correctly recognizes that national security now encompasses the economic and institutional foundations of the country. Its weakness lies in acknowledging the instruments of hybrid warfare without clearly identifying the principal actors employing them.
Canada’s challenge is not merely to become less dependent on Washington. It is to become more capable of defending its sovereignty, protecting its institutions, and contributing meaningfully to allied security.
A credible national security strategy must identify not only what Canada needs to protect, but who is exploiting its vulnerabilities, through which mechanisms, and toward what strategic objectives.
Scott McGregor is a former Canadian Armed Forces intelligence operator and intelligence adviser to the RCMP. He is the co-author of “The Mosaic Effect: How the Chinese Communist Party Started a Hybrid War in America’s Backyard.”
Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.
