Canada's China election interference debate is intensifying

• "China is targeting Canada because it is a G7 country, there is a large Chinese diaspora, there are vulnerabilities in our electoral process and, up until recently, there were no consequences for meddling in Canadian business," Guy Saint-Jacques, who served as Canada's ambassador to China from 2012 to 2016, told Axios.

Details: Canadian news reports earlier this year, citing anonymous Canadian intelligence officials and leaked classified documents, alleged that Chinese intelligence officials had funneled donations to its preferred candidates — all members of Canada's Liberal Party led by Prime Minister Justin Trudeau.

• The Chinese government also allegedly spread online disinformation targeting Conservative Party candidates critical of China.
• There are also allegations that Beijing has harassed and threatened Chinese communities in Canada, eroding their ability to participate freely in Canadian politics.
• Michael Chong, a Conservative lawmaker in Canada's Parliament who has been critical of China's human rights record, told U.S. lawmakers this week about China's efforts to collect information about him and harass his family in Hong Kong.
• Beijing has denied the allegations, calling them "slander and defamation."

What's happening: There is an intense debate about what the government should do to protect Canada's democratic processes from external interference, while also addressing concerns that a heavy-handed response might unfairly target Chinese Canadians.

• Some analysts have criticized the Canadian government for failing to act earlier or to share intelligence with lawmakers.
• Without the intelligence leaks to the press earlier this year, "we would still be oblivious to what had happened in our last two elections," Margaret McCuaig-Johnston, a board member at China Strategic Risks Institute and a former senior Canadian government official, told Axios.
• Once the public inquiry is completed, "the big question will be how the government, and more precisely the Liberal Party, has been handling the information that its security services were providing," Saint-Jacques said. "Why were no forceful measures taken?"
• Trudeau has said he takes concerns about foreign interference "extraordinarily seriously."
• The Canadian Embassy in D.C. did not immediately respond to a request for comment.

State of play: Trudeau called last week for democratic countries to work together to expand trade ties across Asia so that Beijing cannot "play us off each other" in a scramble for access to the Chinese market.

• The U.S. is Canada's largest trading partner, importing 77% of Canada's total exports in 2022. China is a distant second, importing less than 4% of Canadian exports last year.

• Canada is a member of the Five Eyes intelligence sharing alliance with the U.S., Australia, New Zealand and the U.K. — countries that have all faced Chinese government political interference as well.
• The Canadian and U.S. navies sailed warships through the Taiwan Strait over the weekend in their latest joint "freedom of navigation" operation intended to challenge Beijing's unilateral claim to sovereignty over the strait.

Background: A desire to have closer trade ties with China dominated Canada's approach to Beijing during the 2010s, when ties were warm.

• But relations between Canada and China plummeted after the Chinese government detained two Canadian citizens in December 2018 in retaliation for the Canadian government's detention of top Huawei executive Meng Wanzhou in compliance with a U.S. extradition request.
• Former Canadian diplomat Michael Kovrig and consultant Michael Spavor were held for more than 1,000 days. They were charged with espionage but released just hours after an agreement between Meng and the U.S. Department of Justice resulted in the Huawei executive's release.

What to watch: The Canadian government is expected to create a foreign agent registry by the end of the year.

• Government officials have looked to the U.S. and Australia as models. Both countries require people lobbying on behalf of a foreign government or entity to file public disclosures.
• "Electoral interference has to be resolved before the next election," McCuaig-Johnston said. "We can't go into the next election with things hanging over us."

Go deeper: How unheeded warnings about China are now hurting Chinese Canadians