The United Arab Emirates (UAE) and Canada have taken significant strides in enhancing their bilateral relationship through new trade and defense agreements, aiming to bolster economic cooperation and solidify long-term strategic ties. This development occurred during the visit of Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan to Ottawa, where both countries signed a Comprehensive Economic Partnership Agreement (CEPA), updated their defense cooperation agreement, and agreed on diplomatic training initiatives.
The new CEPA, which concluded in a record 47 days of negotiations, is set to eliminate or reduce tariffs on over 99 percent of Canada’s exports to the UAE, addressing trade barriers and expanding access to services in sectors like engineering and environmental industries. Upon full implementation, Canada anticipates that this agreement will help double bilateral trade within the next decade, a strategic move to diversify its economic partnerships beyond the US market.
The UAE, which stands as Canada’s largest export market in the Middle East, is committed to investing up to $50 billion in Canada, targeting key sectors such as energy, artificial intelligence, critical minerals, and infrastructure. This partnership is seen as part of the UAE’s broader strategy to expand international trade networks and diversify supply chains. Notably, more than 150 Canadian companies are already operating in the Emirates, and the new agreements are expected to further these economic ties.
Potential areas of collaboration identified include critical minerals, where Canadian resources could be coupled with Emirati investment for processing and industrial development; agriculture, with Canadian grains and seafood enhancing the UAE’s food security; and artificial intelligence, leveraging Canadian research expertise and energy resources alongside the UAE’s growing technology sector.
Despite the promising outlook, the agreements will require further steps towards implementation. Canada’s Parliament needs to ratify the trade agreement, and investment commitments must transition into tangible projects. These efforts reflect both nations’ shared interest in economic diversification, reliable supply chains, and international cooperation amid global trade uncertainties.