Canada-UAE Trade Pact Targets $5 Billion in Commerce

Canada and the United Arab Emirates signed a free trade agreement on Tuesday that aims to double bilateral trade to nearly $5 billion over the next decade. The deal removes or reduces tariffs on more than 99 percent of Canadian goods shipped to the UAE starting in 2027. Minister of International Trade Maninder Sidhu stated the pact provides Canadian firms with greater access to the UAE's $500 billion economy.

The agreement, known as the Canada-UAE Comprehensive Economic Partnership Agreement, was negotiated in 47 days. Prime Minister Mark Carney said the pact opens new markets for producers of pulses, canola, industrial machinery, and aerospace equipment. He noted that the UAE pledged $50 billion in investment in Canadian energy and development projects, particularly in the Arctic, after his visit to Abu Dhabi last year. Carney said talks this week delivered progress on that pledge but did not provide specific figures.

The signing followed a two day visit by Crown Prince Khaled bin Mohamed bin Zayed Al Nahyan to Ottawa. During the trip, the leaders also signed a memorandum of understanding to create a Joint Military Committee. This body will handle military education, training, joint exercises, and cybersecurity information exchanges. The two governments also began negotiations on an extradition treaty that would allow Abu Dhabi to request the handover of individuals accused of crimes.

Stuart Trew, director of the Trade and Investment Research Project at the Canadian Centre for Policy Alternatives, criticized the pace of the negotiations. He told Middle East Eye that the Emiratis are using the $50 billion investment pledge to pressure Ottawa into concessions. "It looks like Canada is willing to agree to basically anything to try and get that money," Trew said. He expressed concern about an extradition treaty with a state he described as a paranoid surveillance system and a defense deal with a country he accused of fomenting war in Africa.

Rights groups and reporters have cited evidence that the UAE finances the Rapid Support Forces in Sudan's civil war, a group accused of genocide. The UAE denies involvement in the conflict. Trew argued that the government has exaggerated its need for foreign funding to replace the United States trade relationship.

Carney declared the old Canada-US relationship over in May 2025. US tariffs introduced in March 2025 imposed a 25 percent tax on most Canadian goods and a 10 percent tax on energy. Carney's statement said Canada now has preferential access to 1.5 billion consumers across 16 free trade agreements covering 51 countries.

The trade push includes recent deals with other nations. Beijing agreed to lower tariffs on Canadian canola oil to 15 percent while Canada imports 49,000 Chinese electric vehicles. Carney secured 13 commercial agreements worth $700 million during a visit to Saudi Arabia in July. He also began talks on a free trade agreement with Turkey last week and signed a defense memorandum with Kuwait in September.

Trew called the diversification strategy confusing. He noted that automobiles are Canada's second biggest goods export after energy and stated that the country barely exports anything elsewhere at scale.