OTTAWA - Canada's spy agency hired 100 new intelligence officers last year and is moving ahead with plans to expand its headquarters.

In its latest annual report, the Canadian Security Intelligence Service says it will continue to invest heavily in attracting personnel amid continuing threats to national security.

The main focus of CSIS in 2006-07 continued to be terrorism inspired by the ideology of al-Qaida, and the possibility that Canadians could become radical followers.

The intelligence service says it also remained wary of aggressive activities by foreign governments engaged in spying and interference with ethnic communities in Canada.

In the report, CSIS director Jim Judd acknowledges criticism of the agency from the commission of inquiry into the Maher Arar affair.

He says the intelligence service is adjusting policies and working with other federal departments and agencies in response to the inquiry recommendations.