Canada is looking to deepen its economic ties with the European Union as part of efforts to support global trade rules amid renewed tariff threats from US President Donald Trump.
Mary Ng, Canada’s Minister of International Trade, highlighted this strategy in an interview with Reuters, stating that Ottawa is focused on ensuring Canadian businesses can fully access the EU market.
The remarks come as tensions rise over Trump’s tariff policies, which have already impacted trade relations between North America and Europe.
Strengthening Canada-EU Trade Relations
Since the signing of the Comprehensive Economic and Trade Agreement (CETA) in 2017, Canada-EU trade has grown significantly. According to official data, bilateral trade between the two partners has increased by 65% since the agreement came into force. Additionally, in 2021, Canada and the EU established a strategic partnership on raw materials, aiming to secure supplies of critical minerals needed for the clean energy transition.
Ng met on Saturday with European Commission Vice President Maroš Šefčovič to discuss further cooperation.
Earlier, she held talks in Geneva with World Trade Organization (WTO) Director-General Ngozi Okonjo-Iweala, reinforcing Canada’s commitment to a rules-based international trading system.
“Trade agreements are essential, and we see strong trade growth. But we also ask ourselves: What more can we do to help Canadian businesses enter any of the 27 EU member states? And what else can we do to support European businesses in Canada?” Ng stated.
Critical Minerals and Small Enterprises at the Forefront
One of the key areas of discussion between Canada and the EU is securing a stable supply of critical minerals. The EU is looking to reduce its dependence on China for metals such as cobalt, lithium, and nickel—essential components for battery production and the green energy transition. Canada, with its vast reserves of these resources, is positioning itself as a reliable alternative supplier.
The talks also focused on fostering opportunities for small and medium-sized enterprises (SMEs), which play a crucial role in both economies. The Canadian government aims to simplify market access for businesses operating across the Atlantic.
Diversification Amid US Trade Uncertainty
Canada’s efforts to strengthen its economic links with the EU align with its broader strategy to reduce dependence on the US market. In 2018, Ottawa set a target of increasing non-US exports by 50% by 2025. According to Ng, Canada is on track to meet or even surpass this objective.
This push for diversification has gained urgency in light of Trump’s recent tariff threats. The US president has announced plans to impose a 25% tariff on imports from Canada and Mexico, prompting retaliatory measures from both countries. Trump has also warned of additional tariffs on EU goods, escalating transatlantic trade tensions.
Following a conversation with Canadian Prime Minister Justin Trudeau, Trump agreed to delay the implementation of these tariffs for 30 days. However, the uncertainty surrounding US trade policy has reinforced Canada’s determination to strengthen economic ties with other global partners.
Potential WTO Challenge to US Tariffs
Ng indicated that Canada is prepared to challenge any US-imposed tariffs through the WTO if necessary. “We will consider all options available to Canada because we believe in a rules-based trading system,” she stated.
The WTO has played a central role in resolving trade disputes between the two North American neighbours in the past. However, given Trump’s scepticism towards multilateral institutions, there are concerns about how effective WTO mechanisms will be in addressing potential disputes.
A Strategic Shift for Canada and the EU
As geopolitical uncertainties mount, Canada’s pivot towards the EU reflects a broader realignment in global trade. Strengthening transatlantic trade ties not only provides economic benefits but also serves as a hedge against the unpredictability of US trade policy.
For the EU, securing reliable supply chains for critical raw materials is a strategic necessity. Canada’s abundant resources and its commitment to trade rules make it an attractive partner in this regard.
