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Brazil is shocked – shocked I tell you – to learn that there has been espionage going on. It demands an explanation.

It's hard to tell whether the offended party is really offended in a spy case or if they are play acting. In this case, the best guess is that it's a bit of both. Canada-Brazil relations are scuffed, not smashed.

But there may be wider uneasiness around the world, from countries that consider us mostly friendly, that the activities of the U.S.-led Five Eyes – the group of intelligence partners that includes the United States, Britain, Canada, Australia, and New Zealand – are more extensive, and closer to home, than they realized.

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There are important public-interest questions for which we don't have real answers. Has the government of Canada directed intelligence agencies to make economic espionage in foreign countries one of their priorities? Is this kind of metadata spying, and new revelations about the extent of it, really raising angst among our friends and semi-friends such as Brazil or India or South Africa?

The Brazil spy controversy was launched by the leak, via Edward Snowden, of a PowerPoint presentation by an analyst from Communications Security Establishment Canada touting software used to track the communications metadata – IP addresses, mobile handsets, etc., – of a "target," Brazil's Ministry of Mines and Energy. It doesn't say the work was completed, but included real, specific Brazilian metadata.

Spy scandals are embarrassing for the country that gets caught – and often for the one that was exposed. But they rarely cause deep damage to relations between countries.

Last year, Canada convicted Navy Sub-Lieutenant Jeffrey Delisle for selling secrets to Russia, but Ottawa didn't blast Moscow. We spy, too. In international security, it is part of how a sausage is made and is usually not talked about. Occasionally, a government squawks over a high-profile case, often for a domestic audience.

Jez Littlewood, director of the Canadian Centre of Intelligence and Security Studies at Carleton University's Norman Paterson School of International Affairs, suspects that explains Brazil's reaction. "I think that the public reaction is entirely understandable: 'I'm shocked and appalled.' In reality, it's like, 'Yeah, you've been caught. It's embarrassing. We have to react to you being caught.' "

So far, there's little indication it's gone beyond that. Prime Minister Stephen Harper, expressing cryptic concern, said Canada would reach out to Brazil. The meetings have so far been at the diplomat-official level, not calls by Mr. Harper or Foreign Affairs Minister John Baird. Brazilian diplomats in Ottawa won't talk about it in public.

But Brazilian TV news reporters said government officials told them that Canadian bids for resource concessions or contracts might be under suspicion. Mr. Littlewood said it's possible Brazil's government might put Canadian interests in the cooler for a short time, but ties probably won't be ruptured. (Relations with Brazil, hampered by trade disputes, have never been especially warm.) Brazil has focused more of its displeasure at the United States, whose own spying on Brazil made a splash.

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There's always been a little economic espionage among friends, Mr. Littlewood said, but the question now is whether the Canadian government has mandated intelligence agencies to make supporting the economy and trade a priority. University of Ottawa intelligence expert Wesley Wark thinks the Brazil snooping was more likely a task the U.S. gave to a Five Eyes partner, but Canadians should know if there's a mandate for economic spying – which is risky, perhaps not worth it and, if intelligence is provided to companies, littered with potential abuses.

More broadly, the Snowden revelations may raise concerns in many countries, including South Africa, Brazil or even Germany and France, about the scale of U.S.-led electronic data-gathering through the Five Eyes alliance, Mr. Wark said. They may want nationalist restrictions on Internet and telephone networks.

There probably won't be a specific global response, but it could colour the diplomacy of Five Eyes members with countries now surprised by the scale of the snooping.

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