Ottawa expelled Chinese diplomat Zhao Wei on Monday over allegations related to foreign interference, and hours later, China asked a Canadian diplomat in Shanghai to leave by Saturday in response to what it called Ottawa’s “unreasonable actions.”

“We understand there is retaliation, but we will not be intimidated, we will continue to do everything necessary to keep Canadians protected from foreign interference,” Trudeau told reporters in Ottawa.

A row has simmered since the detention of Huawei Technologies executive Meng Wanzhou in 2018 and Beijing’s subsequent arrest of two Canadians on spying charges. All three were freed in 2021.

Some fear the latest flare-up could have economic repercussions for Canada. Chinese imports of Canadian goods rose 16 per cent last year to a record of $100 billion, and China is Canada’s second-biggest trading partner after the U.S.

Last year, Beijing lifted a three-year ban on imports of canola, Canada’s largest crop, from trading companies Richardson International and Viterra. China is also a major importer of Canadian potash and wheat.

“With China, there’s always a risk” of retaliation, said Tyler McCann, managing director of the Canadian Agri-Food Policy Institute. “(But) it seems the Chinese government is more sensitive about food security than they were years ago and that might mitigate the risk.”

Global supplies of wheat and vegetable oil are in tighter supply due to the Ukraine war, which may make it difficult for China to limit its imports of Canadian wheat and canola.

China “took a very measured response,” Guy Saint-Jacques, a former Canadian ambassador to China, said in an interview on CBC. He said the Chinese could have responded by expelling a more senior official or multiple officials.

Saint-Jacques also said he does not expect China to resort to economic sanctions because Beijing is trying to reassure foreign companies that they can work there after draconian COVID-19 restrictions were dropped.

Beijing has this year rolled out the red carpet for Western leaders including French President Emmanuel Macron, and China’s Premier Li Qiang has reached out to corporate leaders to ensure them the country is now open for business.

Beijing is conducting a “charm offensive (to) convince foreign enterprises to come back to China to invest,” Saint-Jacques added. “So putting sanctions on Canada at this stage would have sent a very bad message to foreign companies.”

— Reporting for Reuters by Ismail Shakil and Steve Scherer in Ottawa, additional reporting by Rod Nickel in Winnipeg.

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“The Ukraine crisis is creating shock waves when it comes to supply chain and especially food security and impacting the most vulnerable at the most difficult time,” said Harjit Sajjan, minister of international development.

“We are making adjustments to reflect this… People are going hungry because the prices of food have gone up,” Sajjan told Reuters in an interview in Jordan, the first leg of a regional tour that also takes him to Egypt and Lebanon.

He did not give the new aid figure but the Ottawa-based Canadian International Development Platform said there was a 27 per cent rise in foreign aid last year to around $6.6 billion.

The United Nations has said a global food crisis fuelled by conflict, climate shocks and the COVID-19 pandemic is growing because of the ripple effects of the war in Ukraine driving rising prices of food, fuel and fertilizer.

Over 50 million people in eastern Africa will face acute food insecurity this year, according to a new study backed by the U.N.’s World Food Program (WFP) and Food and Agriculture Organization (FAO).

Sajjan said Canada is boosting aid to the WFP, whose annual requirements have reached an all-time high of $22.2 billion, without taking away from other development programs.

“We have increased our support for the Middle East region when it comes to food,” he said citing as one example Lebanon, which has a significant reliance on Ukraine wheat and is facing bread shortages.

He described as a positive step an agreement brokered with Russia and Ukraine last month by the United Nations and Turkey to unblock grain exports from Black Sea ports but said the few shipments so far were not enough to ease the crisis.

Canada was also increasing aid to Egypt, typically the world’s biggest wheat importer, and to Afghanistan, Yemen and Syria that have been riven by conflict.

Canada was also looking at how to help improve resilience in African countries, noting in particular the continent’s shortage of food storage.

— Suleiman Al-Khalidi is Reuters’ chief correspondent for Jordan and Syria.

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Trudeau’s hand was forced when Innovations Minister Navdeep Bains, 43, unexpectedly announced he was resigning from politics for family reasons. Bains, who has two school-age daughters and had been in the job since November 2015, was a senior minister from Ontario, a Liberal stronghold.

Canadian prime ministers traditionally shuffle their team if a cabinet member says they will not run in the next election.

Francois-Philippe Champagne, 50, will leave the foreign ministry to take over for Bains. Marc Garneau, 71, moved from transport to become Canada’s fourth foreign minister in just over four years.

Garneau’s main tasks will be establishing relations with the incoming Biden administration in the U.S. and handling a major diplomatic dispute with China.

One of Champagne’s first jobs will be to decide whether to allow China’s Huawei Technologies to supply next-generation equipment for 5G networks. Liberal sources say Ottawa will ban Huawei gear but is keeping silent so as not to anger Beijing.

Omar Alghabra, 51, will replace Garneau at transport and Winnipeg MP Jim Carr rejoins cabinet as a special representative for the Prairies, where the Liberals failed to win seats in the last election.

Alghabra, a backbench Liberal MP for Mississauga (2006-08, 2015-present), now takes responsibility for federal transport policy, significant to rail-dependent Prairie grain growers and to exporters moving Canadian commodities overseas.

A mechanical engineer by profession, he has previously served in several parliamentary secretary posts, including international trade diversification and consular affairs.

Carr, 69, had been minister for international trade diversification heading into the October 2019 federal election, but stepped down from cabinet at that time to undergo cancer treatment.

Trudeau said last week there could well be an election this year but stressed he wanted to stay in office to focus on the coronavirus epidemic.

— Reporting for Reuters by Steve Scherer and David Ljunggren in Ottawa. Includes files from Glacier FarmMedia Network staff.

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Prime Minister Justin Trudeau had made Freeland his main U.S. go-between when he named her deputy prime minister after last year’s election, with Foreign Minister Francois-Philippe Champagne handling all the other diplomatic files.

Now Champagne will also handle U.S. ties, sources said.

“We’re back in more of a traditional setup in terms of the relationship,” said one of the sources. “Obviously with any relationship as complex as the Canadian-U.S. one, by necessity, different ministers will be speaking to their counterparts.”

As foreign minister in Trudeau’s previous government, Freeland had led Canada’s hard-nosed renegotiation of a new North American trade deal, known as the Canada-U.S.-Mexico Agreement (CUSMA).

Because of the long shared border and close economic ties, the United States is by far Canada’s most crucial ally, and the relationship was often strained during the trade negotiations and a dispute over aluminum tariffs.

In September 2018, President Donald Trump hinted he did not like Freeland, without naming her.

“We’re very unhappy with the negotiations and the negotiating style of Canada. We don’t like their representative very much,” Trump said at the time.

Freeland will continue to support the prime minister in managing the U.S. relationship, a third government official said, “particularly in the fight against the unfair and unjust U.S. aluminum tariffs.”

Tensions erupted again earlier this month when Trump moved to reimpose 10 per cent tariffs on some aluminum products, prompting Freeland to respond the next day with retaliatory tariffs.

Canada has not yet officially informed the United States of the change in Freeland’s responsibilities, a source familiar with the matter said.

“The most significant relationship we have with the United States is an economic one… so she’s still going to very much be there” as finance minister, said Stephanie Carvin, an assistant professor of international relations at Ottawa’s Carleton University.

Freeland also remains Trudeau’s deputy prime minister, while New Brunswick MP and Privy Council president Dominic LeBlanc was shuffled Tuesday into Freeland’s spot as intergovernmental affairs minister — a post LeBlanc previously held in 2018-19.

— Reporting for Reuters by Steve Scherer and David Ljunggren.

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Trudeau on Tuesday appointed Francois-Philippe Champagne, the rookie MP for the Shawinigan-area riding of Saint-Maurice-Champlain, as minister of international trade, replacing Chrystia Freeland.

Freeland, as widely expected leading up to Tuesday’s announcement, becomes minister of foreign affairs, replacing Stephane Dion. However, the government said Tuesday, Freeland also keeps responsibility for the Canada-U.S. relations file, including trade relations.

Champagne, who has been parliamentary secretary to Finance Minister Bill Morneau since December 2015, was acting general counsel and strategic development director for AMEC, an engineering and consulting firm for the energy sector, before entering politics.

Champagne, 46, previously also served as a vice-president and senior counsel for international industrial tech firm ABB Group and was named in 2009 as a “young global leader” by the World Economic Forum.

Freeland, an internationally known journalist and author before entering politics, is known for her connections in Washington, but has also been a vocal critic of Russian President Vladimir Putin, who has banned her from travel to Russia since 2014.

Tuesday’s shuffle also sees Ahmed Hussen named minister for immigration, refugees and citizenship, replacing John McCallum, a longtime MP and minister in previous Liberal administrations. Trudeau said Tuesday he plans to nominate McCallum as Canada’s ambassador to China.

Dion, a former federal Liberal leader and MP since 1996, said in a statement Tuesday he would now “deploy my efforts outside active politics” but gave no specific timeline for his departure.

The shuffle also sees Patricia Hajdu, the minister of status of women, promoted to the employment, workforce development and labour portfolio, replacing MaryAnn Mihychuk, who is dropped from cabinet but is staying on as MP for the Winnipeg riding of Kildonan—St. Paul.

Trudeau said Mihychuk “served the government with distinction” as she oversaw a “significant expansion of the Canada Summer Jobs program and settled the Canada Post labour dispute.”

Maryam Monsef, minister for democratic institutions, replaces Hajdu as minister of status of women. Karina Gould, currently parliamentary secretary for international development, is promoted in turn to the democratic institutions portfolio.

Trudeau announced Monday he plans to hold a cabinet retreat in Calgary on Jan. 23-24, where ministers are to discuss “how to continue creating good, middle-class jobs and delivering economic growth that is felt from coast to coast to coast.” –– AGCanada.com Network

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“Dion is out,” said the person, who requested anonymity because of the sensitivity of the situation.

The Canadian Press, which initially broke the story, said the move was scheduled for Tuesday and would involve at least six people.

The shuffle would be the first time Trudeau has made major changes since his Liberals took power in November 2015, allowing him to recast his cabinet ahead of Donald Trump’s inauguration as U.S. president.

Relations with the U.S. will be crucial over the next four years and Trudeau may have decided he needs a better communicator than Dion, a French-speaker and former professor who sometimes stumbles when speaking English.

Trump’s vow during the campaign to either tear up or renegotiate NAFTA could have calamitous consequences for Canada, which sends 75 per cent of its exports to the U.S.

One leading candidate to replace Dion would be Trade Minister Chrystia Freeland, an author and former reporter who worked for several years in the U.S. and has good connections in Washington.

Such an appointment would be complicated as Trudeau wants to improve ties with Russia, which banned Freeland — who is of Ukrainian descent — in the wake of Russia’s annexation of Crimea in 2014.

Freeland, who is sometimes pictured in Ukrainian national dress, has been harshly critical of Russian President Vladimir Putin.

Trudeau and Dion’s offices declined to comment. Freeland’s office did not respond to requests for comment.

Dion, 61, a former federal Liberal leader who held ministerial posts in previous governments from 1996 to 2006, was widely criticized last June for not defending a reporter when China’s foreign minister berated her at a news conference.

He also came under fire for the government’s handling of a controversial arms deal with Saudi Arabia.

— David Ljunggren is a Reuters political correspondent in Ottawa. Additional reporting for Reuters by Leah Schnurr.

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