Canada is accelerating efforts to deepen its economic and strategic ties with Europe, as its relationship with the United States faces its worst trade tensions in decades, according to a report by The Wall Street Journal.
Canadian Prime Minister Mark Carney has held talks with European leaders, including in France, Germany, and Italy, exploring ways for Canada to move closer to the EU without seeking full membership in the bloc, the report states.
Canadian officials are examining the possibility of an "association agreement" that could offer increased access to the EU's $21 trillion single market, particularly in strategic sectors such as energy, artificial intelligence, critical minerals, and defense.
Two developments – U.S. President Donald Trump's attempts to take control of Greenland and his war with Iran – have, according to some European leaders, strengthened the case for closer ties with Canada. Carney has increased his contacts with leaders who are traditionally closer to Trump, including Italian Prime Minister Giorgia Meloni, while maintaining frequent contact with French President Emmanuel Macron and Finnish President Alexander Stubb.
In early summer, Canadian and European officials had already intensified talks through multiple diplomatic channels. During preliminary meetings of the Group of Seven (G7) most developed industrial countries in France, they identified 11 areas for deeper cooperation aimed at reducing dependence on the U.S. in technology, defense equipment, and trade.
During Carney's meeting with Macron in Paris before the G7 summit in Evian in June, French officials were reportedly surprised by the speed and scale of Canada's proposals. At the same time, Carney was in frequent contact with German Chancellor Friedrich Merz, as the two countries finalized negotiations for Canada's planned purchase of German submarines worth $25 billion.
Talks may also include easier movement of workers, expansion of university exchanges and research cooperation, as well as collaboration on data centers, subsea cables, cloud infrastructure, and satellite networks.
Carney also seeks to strengthen Canada's energy ties with Europe, including infrastructure that could allow Canadian natural gas to reach European markets.
The initiative reflects Ottawa's attempt to reduce its heavy economic dependence on the U.S. Canada sends two-thirds of its exports across the border, making diversification a major challenge.
Carney, who previously served as Governor of the Bank of England, is betting that closer ties with Europe will help Ottawa withstand pressure from Washington while reshaping its long-term economic orientation towards the United States.
However, European governments are adopting a cautious approach to the proposal, as some worry that a dramatic shift in Canada-EU relations could further escalate relations with Washington.
