Morning. In focus today, how Canada’s electronic spy agency is giving more visibility to its economic defences.
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In the news
Oil: A private-sector proponent will not be backing Alberta’s initial proposal for a new oil pipeline to the West Coast.
Procurement: Canadian defence startup Dominion Dynamics has raised $139-million to scale and secure a federal government contract.
Science: As the Large Hadron Collider shuts down in Geneva, B.C. researchers are working toward its next iteration.
🪝 Programming note: Business Brief will be gone fishing on Canada Day. (Metaphorically speaking. If you’re actually doing something fun, send pictures so that I might fish vicariously through you: cws@globeandmail.com)
A military helicopter prepares for a supply drop to Canadian Rangers conducting Arctic sovereignty training in the Northwest Territories.COLE BURSTON/Getty Images
In focus
The new frontlines in Canada’s national defence
» The war on the dark web: Canada’s electronic eavesdropping agency conducted cyberattacks to disrupt the activities of online foreign criminals who were brokering the purchase and sale of precursor chemicals used to make the opioid fentanyl, The Globe and Mail’s Steven Chase reported.
» A growing corporate concern: In its annual report, the Communications Security Establishment also highlighted its growing cyber capabilities and domestic tech partnerships, which are aimed at protecting key supply chains and bolstering Canadian economic competitiveness against foreign actors.
The CSE details an escalating volume of threats to Canadian business and infrastructure, bringing more visibility to its efforts to counter threats targeting the private sector.
Working with its Five Eyes security and intelligence partners, the agency said it carried out a successful cyberoperation against a group responsible for more than 25 incidents against Canadian organizations in transportation, healthcare, pharmaceuticals and private industries.
Writing in her opening message, CSE chief Caroline Xavier positioned the economic and corporate operations as a natural extension of its historical mission.
“What we do, and the impacts we have on Canada’s safety, prosperity and security, are very tangible, if not always publicly visible,” Xavier wrote. “Our work is shaping the decisions that protect Canada’s citizens, defend our values, and reinforce Canada’s role as a trusted partner on the world stage.”
And lest Canadians think they can relax on Canada Day, Xavier warned: “These threats do not sleep, nor do they retreat in bad weather, nor do they take breaks on statutory holidays.”
These threats are the absolute worst.
» AI tools: ‘A core business risk.’ Foreign adversaries are weaponizing frontier artificial intelligence to actively target corporate networks, using AI tools that are “shortening the time between vulnerability discovery and exploitation,” the report said.
In a rare joint statement last week, CSE joined Canada’s Five Eyes colleagues – the cyber security agencies in Britain, Australia, New Zealand and the U.S. – in warning corporate leaders to prepare for threats that have grown from hypothetical concerns to urgent board-level business issues.
“Cyber risk can no longer be treated as a purely technical issue. This is a core business risk and leadership responsibility,” the statement read.
Those increasingly powerful and widespread methods represent a major threat to the digital systems underpinning the Canadian economy, the agency said in the report.
In the winter of 2025, a Chinese state-sponsored cyber espionage campaign systematically breached commercial telecommunications networks. The group compromised communications routing networks worldwide, spurring the CSE to issue emergency technical guidance to domestic telecommunications providers alongside the FBI and the National Security Agency in the U.S.
» Protecting networks and the North: The agency also highlighted an escalation of its own intelligence and cyber-defence operations in the Arctic in response to increased attention from Russia and China. Foreign state interests in the North extend “beyond traditional military and cyber threats to include economic and influence-related activities that seek to shape access, infrastructure, and decision-making in the region.”
The report doesn’t list the businesses under attack, but it said the foreign “influence-related activities” involve systematic intelligence gathering on local “political intentions, military capabilities, technological advancement, economic interests and research activities.”
In response, the report said, the CSE used specialized cybersecurity sensors across the IT infrastructure of territorial governments in Yukon, the Northwest Territories and Nunavut to prevent foreign state actors from mapping northern community systems.
Along with federal security and law enforcement agencies, the CSE was mostly shielded from the federal government’s 2025 spending reduction exercise as Prime Minister Mark Carney aims to strengthen the country’s global intelligence-sharing contributions and military support.
The annual report is the CSE’s first since the federal government unveiled its Defence Industrial Strategy in February, 2026 – a blueprint to buy from domestic suppliers and build up strategic autonomy.
You really want some fake news to be real. Here, an image from the music video for ‘A letter from future you.’Communications Security Establishment
» Going country: Alongside an interactive online quiz testing Canadians’ hackability, the report notes that private- and public-sector partners supported a cyber awareness campaign by co-creating and sharing resources – including a new, full-length country pop song and music video.
It was not immediately clear whether AI was used in its creation.
Charted
Flight risk
Some major airlines have started slashing fuel surcharges as peace talks in Iran appeared poised to ease strained oil supplies. But most carriers aren’t jumping to cut costs, as summer travel demand remains strong despite higher prices.
Oil prices gained more than 1 per cent yesterday after attacks by the U.S. and Iran underscored the fragility of their interim peace deal. The ups and downs of oil and air travel.
Quoted
We had pretty much all of Australia here ready to drink us dry.
— Tyler Broers, general manager of Dublin Calling
A day in the life of Vancouver’s service industry on a World Cup game day.
Up next
More files we’re following
Today: Statistics Canada releases April’s gross domestic product. The economy is expected to show a miniscule increase of 0.4 per cent from March, breaking a flat stretch that lasted two quarters.
Tomorrow: Bank of Canada Governor Tiff Macklem joins a panel at the ECB Forum on Central Banking in Portugal.
Morning update
Global markets were on the rise, headed for their best second-quarter performance in years on AI optimism and signs of easing geopolitical tensions in the Middle East.
Wall Street futures were in positive territory after Dow hit a fresh record close yesterday. TSX futures followed sentiment higher.
Overseas, the pan-European STOXX 600 was up 0.92 per cent in morning trading. Britain’s FTSE 100 rose 1.01 per cent, Germany’s DAX advanced 1.21 per cent and France’s CAC 40 gained 0.49 per cent.
In Asia, Japan’s Nikkei closed 0.86 per cent higher, while Hong Kong’s Hang Seng declined 0.86 per cent.
The Canadian dollar traded at 70.25 U.S. cents.
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