Canada Forges New Global Trade and Security Alliances Under Prime Minister Carney

Introduction: A New Era of Global Engagement

Under the leadership of Prime Minister Mark Carney, who assumed office in March 2025, Canada is embarking on an ambitious strategy to expand its global trade footprint and reinforce international security cooperation. This initiative seeks to diversify Canada's economic partnerships and strengthen its position in a rapidly evolving geopolitical landscape. The government's focus is on building new relationships and enhancing existing ones across multiple continents.

Expanding Trade Horizons and Diversification Efforts

A cornerstone of Prime Minister Carney's agenda is the expansion of Canada's export strategy, with a stated goal of achieving 50% more overseas exports by 2025 and doubling non-U.S. exports by 2035. Canada currently maintains a broad global trade network, including 15 free trade agreements with 49 countries and 36 foreign investment promotion and protection agreements (FIPAs).

Recent trade developments include:

• A new trade deal signed with Indonesia.
• The announcement of 'energy corridors' to boost trade with Mexico.
• Initiation of trade talks with the United Arab Emirates (UAE), including a Foreign Investment Protection Agreement (FIPA) and anticipated free-trade agreement negotiations.
• Resumption of free trade agreement (CEPA) negotiations with India, aiming to boost bilateral trade to $50 billion by 2030.
• The launch of free trade negotiations with Thailand, announced during Prime Minister Carney's visit to the Asia-Pacific Economic Cooperation (APEC) Economic Leaders' Meeting in Gyeongju, Republic of Korea.
• A renewed Canada-Chile Strategic Partnership Framework, focusing on critical minerals, clean energy, wildfire management, and digital technologies.
• Discussions with the People's Republic of China to renew the Canada-China relationship.
• Ongoing efforts towards a Digital Trade Agreement with the European Union (EU), emphasizing alignment in standards, infrastructure, cybersecurity, artificial intelligence, and quantum technologies.

Strengthening International Security Alliances

In addition to trade, Canada has significantly bolstered its security cooperation with key international partners. On June 23, 2025, Canada and the European Union signed a landmark Security and Defence Partnership in Brussels. This agreement commits both parties to defence collaboration and paves the way for Canada's participation in Europe's new defence procurement program, 'ReArm Europe'.

A significant outcome of this partnership is Canada's secured participation in the EU's SAFE (Security Action for Europe) initiative. This grants Canada preferential access as the only non-European country, unlocking potential defence opportunities for Canadian businesses and providing up to $244 billion in loans to EU Member States for defence projects. The agreement also includes expanded cooperation in support of Ukraine, improved Canadian military mobility in Europe, and enhanced maritime cooperation in the Indo-Pacific.

Further security engagements include:

• A new Canada-Republic of Korea Security and Defence Cooperation Partnership, the first of its kind for Canada in the Indo-Pacific, covering security, defence, industry, cyber, space, and hybrid threats. Negotiations for a General Security of Information Agreement with South Korea have also concluded.
• Continued commitment to the Canada-Ukraine Security Cooperation agreement, initially signed on February 24, 2024, which includes $1.6 billion in military assistance.
• A trilateral letter of intent signed on July 10, 2024, by Defence Ministers from Canada, Germany, and Norway, aimed at strengthening maritime security cooperation in the North Atlantic.

Domestic Economic Resilience and Strategic Investments

To support its global ambitions and protect domestic industries, the Canadian government has introduced new trade and financing measures. These include tightening limits on imported steel and increasing financial support for lumber producers. The government's Budget 2025 outlines a plan for generational investments to build, protect, and empower Canada.

Export Development Canada (EDC) is set to increase its total facilitated business by $25 billion by 2030, specifically targeting the expansion of Canadian exports in critical minerals, energy, clean technology, infrastructure, and defence sectors. These measures underscore Canada's commitment to transforming its economy from one reliant on a single trade partner to one that is more diversified and resilient to global shocks.