Things seem to be turning south between the two countries.
This comes in the wake of statements by Foreign Affairs Minister Chrystia Freeland and her department last week where Ottawa called on the Saudis to release arrested civil-rights activists and signalled concern at a new crackdown in the Mideast country.
In public statements Sunday, Riyadh gave Canadian ambassador Dennis Horak 24 hours to leave the country and recalled its own envoy.
The Saudis said they will "put on hold all new business and investment transactions with Canada while retaining its right to take further action."
In a statement released through the Saudi Press Agency, Riyadh bluntly condemned the criticism from Ms. Freeland and the department of Global Affairs, calling it "blatant interference in the Kingdom's domestic affairs, against basic international norms and all international protocols" and a "major, unacceptable affront to the Kingdom's laws and judicial process, as well as a violation of the Kingdom's sovereignty."
The Saudis warned in a statement that any more criticism will be interpreted as licence to meddle in Canadian affairs.
"Any further step from the Canadian side in that direction will be considered as acknowledgment of our right to interfere in the Canadian domestic affairs," the Saudis said. The Canadian government did not immediately comment Sunday night in response to the Saudi action.
Two-way merchandise trade between Canada and Saudi Arabia exceeded $4-billion last year, a significant portion of it from a controversial multibillion-dollar deal to sell combat vehicles equipped with machine guns and cannons to the Saudis. Saudi Arabia is one of Canada's biggest export markets in the Gulf region and more than 15,000 Saudi students attend Canadian schools and universities.
Last week, the Canadian government publicly took the Saudis to task after the kingdom arrested two women's-rights activists, the latest to be swept up in a government crackdown on activists, clerics and journalists.
Those detained included activist Samar Badawi, sister of writer Raif Badawi who is already imprisoned in Saudi Arabia and sentenced to 1,000 lashes for insulting Islam.
Ms. Freeland said via Twitter last Thursday that she was "very alarmed to learn that Samar Badawi, Raif Badawi's sister, has been imprisoned in Saudi Arabia. Canada stands together with the Badawi family in this difficult time, and we continue to strongly call for the release of both Raif and Samar Badawi."
On Aug. 3, the Canadian government's main foreign policy Twitter account followed this up by saying that "Canada is gravely concerned about additional arrests of civil society and women's rights activists in #SaudiArabia, including Samar Badawi. We urge the Saudi authorities to immediately release them and all other peaceful #humanrights activists."
Amnesty International Canada secretary general Alex Neve said what has happened is a "clear indication that Saudi Arabia remains determined to rebuff and ignore any efforts to improve and address human rights concerns in the country."
Omar Allam, a business consultant in Canada who advises companies looking to do business with Saudi Arabia, said the Saudis are angry at what they consider foreign interference in their domestic affairs.
Mr. Allam said the Saudi-Canadian relationship has been strained in recent years because of a public debate over whether to sell billions of dollars of armoured vehicles to Riyadh and the kingdom's continued imprisonment of Mr. Badawi, whose wife and children now live in Canada. Ms. Badawi's wife was recently granted Canadian citizenship.
Mr. Allam speculated that: "There's such alienation on the Saudi side they just put their arms up and said 'Enough is enough,' "
The Trudeau government has taken a lot of criticism for issuing export permits for a deal to sell billions of dollars of weaponized armoured vehicles to Saudi Arabia, a country that ranks among the "worst of the worst" on human rights by U.S. watchdog Freedom House.
Criticism of the deal angered the Saudis, who said publicly that the contract was intended to be a gift to cement friendship between the two countries and noted Riyadh could easily have awarded it to manufacturers elsewhere in the world.
Mr. Allam said what's happened reminds him of a 2015 diplomatic dispute between Sweden and Saudi Arabia. Saudi Arabia recalled its ambassador from Sweden and Stockholm cancelled a defence agreement with the Saudis. The row followed an incident where the Saudis had blocked Swedish Foreign Minister Margot Wallstrom from speaking about human rights at an Arab leaders' summit. Ms. Wallstrom had also criticized the 1,000-lash sentence for Mr. Badawi as "medieval."
The Globe and Mail reached Saudi ambassador Naif Bin Bandar al-Sudairi by telephone Sunday but he said he was out of the country and too busy to talk.
An English version of the Saudi government's statement said Ms. Freeland and the Canadian government are wrong to criticize the kingdom.
"The Saudi Ministry of Foreign Affairs has expressed disbelief by this negative unfounded comment ... the persons referred to were lawfully detained by the Public Prosecution for committing crimes punishable by applicable law, which also guaranteed the detainees' rights and provided them with due process during the investigation and trial."
The ministry said it considers Ms. Freeland's actions "as an affront to the kingdom that requires a sharp response to prevent any party from attempting to meddle with Saudi sovereignty," and it chided Canada for what it called undiplomatic language. "It is quite unfortunate to see the phrase 'immediate release' in the Canadian statement, which is a reprehensible and unacceptable use of language between sovereign states."
Firstly, we should rehabilitate the rule requiring non-interference in the internal affairs of other countries. We thought we could beat-up everyone who acted in ways we disapproved, but it has failed, the dominion of internationally traded currencies is not happening, globalisation has ended and the reaction of nationalism is asserting itself everywhere. We failed.
We can achieve a consensus in humanity by debate and agreement, probably involving the United Nations, not this impatient forced stuff from western officials with elections to win. If we don't like a country we do not connect with it. If they say they'd like to visit or buy our products, we tell them we can't do that while they continue policies we dislike. What could be simpler.