BRUSSELS, October 5 The story begins with a quiet push beyond what already exists. Ahead of the EU-Canada summit at the end of October 2026, both sides are discussing a partnership that would build on the Comprehensive Economic and Trade Agreement, which has been provisionally applied since 2017 and removed 98% of tariff lines immediately, rising to 99% by 2024. At its heart, the talks aim to deepen ties in areas CETA does not fully cover.
Trade in goods and services reached €130 billion in 2025, up 80% from €72.1 billion in 2016, according to Commission figures. Prime Minister Mark Carney proposed exploring an integrated market for financial services, alongside cooperation on payments, strategic minerals, energy, AI, and defence production.
For those involved, the stakes are clear. Fabian Zuleeg, Chief Executive and Chief Economist at the European Policy Centre, says the summit must deliver more than words, stating, ‘So by the time we get to the summit, we should really be concrete.’ The EU’s problem is dependence: it relies on the US for technology and security, on Chinese supply chains for critical inputs, and on outside suppliers for energy, at a time when trade access is increasingly used as leverage.
Canada offers economic gains in areas like financial markets and technologies CETA does not fully cover. Erik van de Merel, chief economist at the European Centre for International Political Economy and associate professor at the Université Libre de Bruxelles, notes that tariffs among developed countries and between Canada and the European Union are fairly low, and the next gains lie in services, technology collaboration, and intangible activities important for future growth.
Negotiations on a Digital Trade Agreement began in March 2026. For the EU, the appeal is security of supply: Canada says it holds deposits of more than 34 critical minerals and is a leading producer of 10 considered essential to the energy transition, which Europe needs for batteries, grids, and defence. Zuleeg adds that reducing reliance on China matters less for prices than for keeping European industry running during a dispute.
For Ottawa, the logic is diversification: the US takes roughly seven in ten Canadian exports, while the EU was Canada’s second-largest goods-trade partner in 2024 with 7.9% of its global goods trade. Canada also wants easier access to European customers and investors for its clean-energy, mining, AI, and defence firms. Canadian pension funds could co-finance mineral-processing and infrastructure projects.
Defence is already a test case: in June 2026, Canada became the first non-European country included in the EU’s €150 billion SAFE initiative. The new ‘associate member’ tier has no legal definition.
Nothing has been agreed on financial passports, mutual recognition of licences, or bank access.
