The return of Donald Trump to the White House in 2024 had profound effects on the established structure of interstate relationships within the transatlantic community. His unilateralism, aggressive trade policies and weakening common defence commitments resulted in rising tensions among key members of a once unshakable alliance of Western democracies. Trump did not merely apply tariffs, backtrack on Ukraine and display visible contempt for US allies. He has gone so far as to question the very sovereignty and territorial integrity of Canada and Denmark. The emerging environment of low-trust and uncertainty poses serious economic and security challenges for Europe, as well as Canada. Luckily, the two are remarkably well-positioned to hedge their bets, deepening cooperation with each other in the face of an erratic US foreign policy that compounds existing tensions with Russia and China. In this context, Canada should become an increasingly central element of Europe’s long-term strategy for managing US volatility, as well as Russian and Chinese assertiveness.

Strategic benefits of enhanced partnership between Canada and the EU are evident. Canada is a vast country of just 40 million people, endowed with immense reserves of natural resources. On the other hand, Europe represents a massive market with highly advanced, yet resource-constrained, technological and industrial competencies. As the EU seeks to spool up its defence industry, Canada is eager to shift its defence dependence away from the US. The mutually beneficial exchange of Canada’s resource might for Europe’s technological prowess is now increasingly accessible through the Arctic and the North Atlantic, making the two much closer physically in the long-term than ever before. Finally, both parties have jointly affirmed their ideological alignment, voicing a commitment to uphold democratic values, fundamental human rights and the rule-based international order, both at home and abroad. This solidarity naturally stems from deep societal links that bind Canada to Europe. Canadian society derives a common heritage and a democratic political culture from Europe, with English and French linguistic ties easing cultural, educational and scientific exchange. In sum, cooperation between Canada and the EU rests on a firm bedrock of shared values, complementary economic profiles, common defence needs and convergent political interests.

Brussels and Ottawa certainly seem to understand the great potential that lies with enhanced partnership between them. In 2016, on the eve of the first Trump presidency, Canada and the EU signed the Strategic Partnership Agreement (SPA) and the Comprehensive Economic and Trade Agreement (CETA). Provisionally in effect since 2017, CETA slashed tariffs and opened markets, boosting bilateral trade by nearly 70%. In 2021, the Strategic Partnership on Raw Materials initiative was launched. The Canada-EU Digital Partnership was concluded two years later, reflecting a shared commitment to advancing AI technologies and ensuring supply-chain resilience. In 2024, Canada joined the Horizon Europe research and innovation program, giving Canadians equal opportunity to participate in European scientific initiatives. Shortly after, Trump’s return to the White House in 2024 provided further incentive to cooperate. Brussels and Ottawa have since signed the New Strategic Partnership of the Future and the EU-Canada Security and Defence Partnership agreements, setting the objective to forge a “new ambitious and comprehensive partnership.”

Despite the seeming acceleration of cooperation, partnership with Canada remains Europe’s underplayed card against challenges posed by Russia, China and the increasingly transactional US. CETA remains in force only provisionally, with 10 EU member-states still not having ratified the agreement. A renewal of talks regarding shipments of Canadian Liquified Natural Gas (LNG) to Germany is a positive sign, but there is little tangible progress to-date, all while LNG terminals in British Columbia already began shipments to Asia. EU environmental regulations also continue to limit the ability of Canada’s oil to reach its markets, as Europe struggles to reach its stated goal of reducing dependence on Russian supply. In the security sphere, allowing Canada to be the first non-EU country to join the 150 billion euro Security Action for Europe (SAFE) initiative was the first major step in a promising direction. Defense cooperation between Europe and Canada was historically limited to US-dominated NATO mechanisms as primary vessels for transatlantic defence procurement. SAFE creates new options, but its potential is yet to fully materialize. Brussels and Ottawa have a lot of missed opportunities to make up for, yet both sides remain largely focused on other diplomatic priorities, leaving the EU-Canada track under-resourced.

Prime Minister Mark Carney devotes considerably more time towards forging partnerships in the Indo-Pacific, while EU’s Kaja Kallas also committed the bloc to strengthening the bloc’s security ties in Asia. However, while direct access to the Pacific Ocean rightfully makes Canada a Pacific nation, the EU’s presence in the region is politically fragmented and logistically constrained. Since Canada can also serve as Europe’s safest bridge to the Pacific, the EU has strong reasons to re-assess Canada’s intrinsic strategic value not only as a like-minded ally and a major resource supplier, but also as a key partner in transcontinental logistics. The Canadian Arctic can expand Europe’s options for accessing much-needed resources as well as create supplementary maritime links to coveted Asian markets. Russia’s push to dominate the Northern Sea Route and its proposals for Arctic cooperation with the US highlight the risks of a future global dependence on Moscow and Washington as key arbiters of trans-Arctic trade. To offset this risk, the EU and Canada should dedicate considerable effort and financial resources toward developing the Northwest Passage route. For the EU-Canada relations to transform into a truly comprehensive and mutually beneficial partnership, a long-term strategic commitment to joint Arctic investments may be the flagship project that will incentivise cooperation in all other areas for decades to come. Despite the many regulatory, environmental and political hurdles, a firm focus on Canada is a fail-safe way for Europe to strengthen its hand in a high-stakes game with increasingly unpredictable allies and rivals alike.

Written by Vladimir Petchkovsky, Edited by Valerie Schicke

Photo Credit: European Union (uploaded March 7, 2023)