The Meng Wanzhou affair fundamentally reshaped Canada's approach to China, forcing Ottawa to abandon its long-standing policy of prioritizing trade and engagement over security concerns.

The incident, marked by Beijing's retaliatory detention of two Canadian citizens, exposed Canada's vulnerability to hostage diplomacy and economic coercion.

This led to a significant shift in Canadian policy, which is now more aligned with its allies and grounded in a more realistic view of China as a strategic rival.

How the Affair Reshaped Canada's Approach

Prior to the arrest of Huawei CFO Meng Wanzhou, Canada's China policy was largely guided by a belief that deep economic ties would lead to a stable and mutually beneficial relationship. The Meng affair shattered this illusion and led to a profound re-evaluation of Canada's approach.

• Exposure to Hostage Diplomacy: On December 1, 2018, Canadian authorities arrested Meng Wanzhou at the request of the United States. In apparent retaliation, China quickly detained two Canadians, Michael Kovrig and Michael Spavor, on what were widely seen as politically motivated charges. The fact that the release of the "Two Michaels" was directly tied to the resolution of Meng's case proved that China was willing to use its citizens as political bargaining chips. This demonstrated the stark difference in legal and political systems between the two nations and forced Canada to acknowledge the limits of its "soft power" approach.

• Economic Coercion: China's retaliation was not limited to detaining Canadians. It also imposed an unofficial ban on Canadian agricultural products, most notably canola seed, which had a devastating impact on Canadian farmers. This served as a clear warning that China would use its economic power as a weapon to achieve its political goals. This experience forced Canadian policymakers to confront the risks of over-reliance on the Chinese market and has led to a push for market diversification.

• Increased Alignment with Allies: Caught between two great powers, Canada found itself leaning more heavily on its allies. The U.S., UK, Australia, and other nations publicly condemned China's arbitrary detention of the Michaels and voiced support for Canada's adherence to the rule of law. This diplomatic support highlighted the importance of a united front against China's coercive tactics.

The affair led Canada to formalize a new Indo-Pacific Strategy, which explicitly labels China as a "disruptive global power" and outlines a more comprehensive approach based on the principles of "coexist, compete, and challenge". This is a stark contrast to the previous, more optimistic policy of engagement.

Lessons Learned for the Future

The Meng Wanzhou affair provided Canada with a series of difficult but crucial lessons that will shape its China policy for years to come.

• The Rule of Law is a Strength, Not a Weakness: Throughout the ordeal, Canada insisted that the Meng Wanzhou case was a legal, not a political, matter. While this position led to nearly three years of diplomatic friction and the suffering of the Michaels, it ultimately upheld Canada's commitment to the rule of law. The lesson is that sticking to its principles, even under immense pressure, is a core component of Canada's identity and its standing on the world stage.

• Diversification is Key: The canola ban demonstrated the dangers of placing too many "eggs in one basket." The economic disruption to Canadian farmers was a powerful motivator for the Canadian government and businesses to actively seek out new trading partners and reduce their reliance on the Chinese market. The lesson is that economic security and national security are inextricably linked.

• The Importance of Intelligence and Security: The affair heightened awareness within the Canadian government and public of the security threats posed by China, including potential espionage and intellectual property theft. The Canadian government's eventual decision to ban Huawei's 5G equipment was a direct result of the security concerns raised during the affair.

• Canada Cannot Act Alone: The experience underscored Canada's position as a middle power and the reality that it cannot effectively stand up to China's coercion on its own. The lesson is that Canada's influence is amplified when it acts in concert with its allies, particularly the United States.