I can't claim specific knowledge of the relationship between Canadian diplomatic presence and its information-gathering or intelligence-gathering functions. In general I would say that they are extremely important, especially when you have trained civil servants who have been integrated in local spaces for years and perhaps decades.
Severing those diplomatic ties is often treated as an important signal in international relations, but rebuilding those ties takes much longer. It's not something that can be simply reinserted. You would definitely run the risk of losing access to whatever back-channel sources of information are currently still available.