Canada's intelligence service is warning Canadian businesses about the growing threat of Chinese cyber-spies.

Sources have told CBC News that the Canadian Security Intelligence Service (CSIS) is alerting some of the country's top corporate executives that their companies may be the target of Chinese computer hackers.

In an e-mail, a CSIS spokesperson said the agency can't comment on specific conversations. But the spokesperson said there is "no denying that Canada is an attractive target for economic and political espionage, owing to our prominence in strategic sectors such communications, biotechnology, mineral and energy extraction, aerospace and others."

These revelations follow the spy agency's release of its annual report this week, which contained a stern warning about the potential risks of foreign takeovers. That report comes as the Canadian government is getting set to examine a proposed purchase of an important Canadian resource company by a state-owned Chinese firm.

This week, shareholders of Nexen, a Calgary-based oil and gas producer, voted in favour of a $15.1-billion takeover bid from CNOOC, the China National Offshore Oil Corporation.

The CSIS report doesn’t address any specific business deals. But it does say "while the vast majority of foreign investment in Canada is carried out in an open and transparent manner, certain state-owned enterprises and private firms with close ties to their home governments have pursued opaque agendas or received clandestine intelligence support for their pursuits here."

The report added that "when foreign companies with ties to foreign intelligence agencies or hostile governments seek to acquire control over strategic sectors of the Canadian economy, it can represent a threat to Canadian security interests."

The proposal has been raising questions in the House of Commons. During question period on Friday, NDP MP Nathan Cullen pressed the government to take a close look at the Nexen deal.

"Will anyone on that side of the House stand up and acknowledge that Canadians have real and legitimate concerns about the purchase of Nexen by CNOOC?," asked Cullen.

Foreign Affairs Minister John Baird responded, promising the government "will always act in the best interest of Canadians."

While not naming China as a threat, the CSIS report does document a cyber-attack against the federal Finance Department and Treasury Board in January, 2011; an attack believed to have originated in China. According to the report, such incidents are common.

"The Government of Canada is now witnessing serious attempts to penetrate its networks on a daily basis."

Ray Boisvert, the former assistant head of intelligence at CSIS, says Canadians need to be aware of such threats. He says Canada today finds itself in a security situation that can be compared to the Cold War.

"The difference from the Cold War days, of course, is that back then it was focused on the politics. It was focused on military secrets and political information. Now it's about commercial interests," Boisvert says.

 

With files from Greg Weston