RIYADH/WASHINGTON ( AFP, Bloomberg) - Saudi Arabia said on Monday (Aug 6) it was expelling the Canadian ambassador and had recalled its envoy while freezing all new trade, in protest at Ottawa's vigorous calls for the release of jailed activists.
Saudi Arabia also froze trade, investment and diplomatic dealings with Canada in a dramatic escalation of the row.
The Canadian dollar initially slipped as much as 0.2 per cent against the greenback.
There was a trade flow of US$3.23 billion between Saudi Arabia and Canada in 2017, with Saudi Arabia exporting US$2.14 billion, or 1 per cent, of its products to the North American nation.
The kingdom gave the Canadian ambassador 24 hours to leave the country, in an abrupt rupture of relations over what it slammed as "interference" in its internal affairs.
The move, which underscores a newly aggressive foreign policy led by Crown Prince Mohammed bin Salman, comes after Canada demanded the immediate release of human rights campaigners swept up in a recent crackdown.
"The Canadian position is an overt and blatant interference in the internal affairs of the Kingdom of Saudi Arabia," the Saudi foreign ministry tweeted.
"The kingdom announces that it is recalling its ambassador to Canada for consultation. We consider the Canadian ambassador to the kingdom persona non grata and order him to leave within the next 24 hours."
The ministry also announced "the freezing of all new trade and investment transactions with Canada while retaining its right to take further action".
Canada last week said it was "gravely concerned" over a new wave of arrests of women and human rights campaigners in the kingdom, including award-winning gender rights activist Samar Badawi.
She is a Canadian citizen whose brother Reif Badawi, a blogger who was critical of the Saudi government, was already in jail in the kingdom.
"We urge the Saudi authorities to immediately release them and all other peaceful #humanrights activists," the Canadian foreign ministry tweeted on Friday.
Badawi was arrested along with fellow campaigner Nassima al-Sadah last week, the latest victims of what Human Rights Watch called an "unprecedented government crackdown on the women's rights movement".
The arrests come weeks after more than a dozen women's right campaigners were detained and accused of undermining national security and collaborating with enemies of the state. Some have since been released.
The Saudi foreign ministry voiced anger over the Canadian statement.
"Using the phrase 'immediately release' in the Canadian statement is very unfortunate, reprehensible, and unacceptable in relations between States," the ministry tweeted.
Prince Mohammed, heir to the region's most powerful throne, has introduced a string of reforms such as lifting a decades-long ban on women drivers in a bid to improve the kingdom's austere image as it prepares for a post-oil era.
But the 32-year-old has simultaneously pursued an aggressive foreign policy, while cracking down on dissent and cementing his grip on power.
"The rupture in Saudi diplomatic relations with Canada reinforces how the 'new' Saudi Arabia that Mohammed bin Salman is putting together is in no mood to tolerate any form of criticism of its handling of domestic affairs," said Kristian Ulrichsen, a fellow at Rice University's Baker Institute in the US.