Astounding changes have descended on US/Canada relations, now at a “historic low” between the two very close neighbours, politically and geographically, and who previously enjoyed utterly harmonious ties.
Analysts generally blame US President Donald Trump whose repeated calls for Canada to become America’s 51st state, prompted a wave of anger and patriotism among Canadians. Indeed, the country’s Prime Minister, Mark Carney, told the New York Times, he has even had to prepare for the “extreme tail risk” that Trump might order military action against Canada. The two countries are also now in a US engendered trade war threatening an age-old, mutually beneficial and prosperous trading relationship worth over $800 billion annually.
Against this background and geopolitical stresses generally, we recall Carney’s landmark address this year which received a standing ovation at the World Economic Forum.
To counter the rise of hard power and the disintegration of multilateral institutions like the United Nations and World Trade Organisation, Carney called for “middle powers” to work together to build a more cooperative and peaceful world. We are facing a “rupture, not a transition,” he warned. Great powers are “using economic integration as weapons, tariffs as leverage, financial infrastructure as coercion, supply chains as vulnerabilities. So middle powers must act together, because if we’re not at the table, we’re on the menu.”
The prime minister has indeed been moving to deepen Canada’s global ties, making 26 trips to 29 countries since assuming office in 2025, to “construct a middle-power sphere of trade and deep bonds”.
He has been welcomed in India, Australia, Japan, South Korea, Malaysia, Singapore, Qatar, Saudi Arabia and the UAE among others including several European countries, developing co-operation with nations in wide-ranging areas, including the economy and defence. Carney says Canada’s “reputation as a reliable, predictable partner has rarely been more valuable. We are blessed with many commodities and capabilities,” he says. “But we have earned our most valuable asset — trust.”
The PM has paid special attention to the European Union (EU), the 27-nation bloc now also in a trade war with the US. It is his “strong view that the international order will be rebuilt out of Europe.”
His efforts at stronger ties are succeeding. In a recent address to the European Parliament, President of the European Commission, Ursula von der Leyen, with Carney present, said, “We must urgently reimagine our partnerships,” and turning directly to Carney, she declared, “I would like to work with you on opening the door for Canada to be the first associate member of the European Union.” This produced a standing ovation from lawmakers.
Ms von der Leyen said the bloc, which has historically rejected flexible membership categories, must “respond to the fracture in the international rules-based system” and that “Europe and Canada believe in democracy. We see the world with the same eyes.” Indeed, Carney often calls Canada “the most European non-European country.” And four out of five Canadians want him to bring their country closer to the EU.
The two sides will now move to “an ‘Alliance for the Future’, to create a common prosperity and economic security space”. They will work on six areas including trade, security and regulations, critical raw materials, energy and clean technologies, visa liberalisation and financial systems. This will generate much transatlantic activity which will be further supercharged by Carney’s goal to attract $1 trillion in foreign investment into Canada over the next five years, as he recently told 100 money managers from 25 countries in the first-ever Canada Investment Summit.
European investment has already started in defence. We will now have the biggest defence deal in Canadian history with the German defence firm, Thyssenkrup Marine Systems (TKMS), supplying the Royal Canadian Navy with up to 12 advanced diesel-electric submarines, a project costing over C$100 billion and creating around 50,000 new jobs in the first five years of the programme.
And Canada is the first non-European country to join the EU’s €150 billion SAFE financial scheme, which provides long-term, low-interest loans to improve military capability. Carney’s government has already signed the EU-Canada Security and Defence Partnership, a comprehensive framework for strategic co-operation.
Carney is also leading the effort to set up a “NATO bank”—the Defence Security and Resilience Bank to bolster the defence of allied nations. And Ottawa will now reduce the number of F-35 fighters it buys from Lockheed, an American firm, and supplement these with a fleet of Swedish military surveillance aircraft one third of which will be manufactured in Canada employing about 3,000 Canadian workers.
Canada is “a trusted friend,” says EU foreign-affairs chief, Kaja Kallas. Indeed, Ottawa will contribute to an EU €90bn loan to assist Ukraine in its war with Russia. And it has already allocated $4.7bn in military assistance to Kyiv, with Carney and Ukrainian president Volodymyr Zelenskyy recently signing a “100-year partnership” between the two countries.
Canada and the EU plan to do more together. They will meet for a Summit in Montreal at the end of this month. This Canada/Europe bonding is indeed a bright spot in a darkening international environment. All countries and regions, including Trinidad and Tobago and Caricom, must keep their eyes on it.
