Canada readies new Indo-Pacific strategy amid tense China ties

Canada sees relations with Indo-Pacific countries as vital to national security as well as its economic and environmental goals, Joly said in Toronto ahead of an official trip to the region.

China was an "increasingly disruptive, global power" Joly said, and would need to be a major part of the Indo-Pacific strategy expected to be announced within the next month.

Diplomatic tensions between Canada and China have been running high since the detention of Huawei Technologies executive Meng Wanzhou in 2018 and Beijing's subsequent arrest of two Canadians on spying charges.

While the standoff ended when all three people were released last year, relations have remained sour. Citing national security concerns, Ottawa banned the use of 5G gear from Huawei in May and last week, ordered three Chinese companies to divest from critical minerals in Canada.

This week Beijing pushed back against Prime Minister Justin Trudeau's accusations that China was attempting to interfere with Canadian elections and said Ottawa should stop making remarks that hurt relations.

Canada would stay firm on issues surrounding Taiwan and reported human rights violations in Xinjiang region.

"It's sheer size and influence makes cooperation necessary to address the world's existential pressures such as global health, nuclear non-proliferation, climate change and biodiversity loss," Joly said.

She said Ottawa was investing to better understand how "China thinks, operates and plans." To do that, Canada will spend C$50 million ($37 million) to bolster its network of China experts in embassies, a source close to the matter told Reuters.

Joly warned that there were risks of doing business with China, telling Canadians, "you need to be clear-eyed. The decisions you take as business people are your own."

Business groups welcomed the plans.