The United Arab Emirates (UAE) and Canada have taken a significant step forward in their bilateral relationship through new trade, investment, and defense agreements. During the visit of Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan to Ottawa, the two nations signed a Comprehensive Economic Partnership Agreement (CEPA), an updated defense cooperation agreement, and a memorandum on diplomatic training. Additionally, both governments agreed to initiate negotiations on extradition and mutual legal assistance treaties.
The CEPA, which concluded swiftly in just 47 days of negotiations, is expected to eliminate or reduce tariffs on over 99 percent of Canadian exports to the UAE once fully implemented. This agreement aims to address existing trade barriers and expand access to various services, including engineering and environmental industries. Canada anticipates that this will help double bilateral trade over the next decade as the country seeks to diversify its economic partnerships beyond the US market.
Currently, the UAE stands as Canada’s largest export market in the Middle East, with over 150 Canadian companies operating in the Emirates. The UAE has committed up to $50 billion in investments in Canada, focusing on sectors like energy, artificial intelligence, critical minerals, and infrastructure. These agreements represent a move towards a more structured strategic partnership between the two countries.
The strengthened partnership aligns with the UAE’s strategy to expand its international trade networks and diversify supply chains. Canada’s significant natural resources, agricultural production, and advanced engineering capabilities offer attractive opportunities for collaboration. Key sectors identified for future cooperation include critical minerals, food security, artificial intelligence, and infrastructure.
In the area of critical minerals, Canadian natural resources combined with Emirati investment in processing and industrial development could prove beneficial. For agriculture, Canadian grains, pulses, and seafood could contribute to enhancing the UAE’s food security. Additionally, opportunities in artificial intelligence, research, and data center development are being explored by leveraging Canada’s research expertise and energy resources alongside the UAE’s growing technology sector.
While these agreements mark substantial progress, further implementation is required. Canada’s Parliament must ratify the trade agreement, and investment commitments need to be translated into tangible projects. The strengthened partnership reflects a mutual interest in economic diversification, reliable supply chains, and international cooperation amid global trade uncertainties.