“What we are looking, and will begin discussions for, [is] a unique alliance with the European Union,” Carney told reporters at the Toronto International Film Festival on Sunday. “We share the same values, we have the same priorities, and we have very complementary strengths.”
The U.S. accounted for 72.5% of Canadian merchandise exports in 2025, according to the country's annual trade report, making it Canada’s largest trading partner. But Carney is keen to build an international support network that isn’t reliant on the U.S.
At the E.U.-Canada summit in June 2025, Canada established a new Security and Defense Partnership with the bloc. “Our partnership is grounded in the core values we share: democracy, human rights, the rule of law, and open, rules-based markets," read a joint statement marking the occasion.
Continuing with these efforts, Carney on Monday brought together executives and senior leaders from global investment firms to encourage them to invest in the country at the Canada Investment Summit in Toronto.
Here’s a look at the alliance options on the table between Canada and the bloc, and what that could mean for U.S.-Canada relations.
“We’re not looking to become a member,” Carney said, emphasizing he’s instead keen to form an alliance. “We’re stronger together, and this is at a time where the world’s more dangerous and divided, and friends need to stick together in these times.”
However, a report in the Wall Street Journal, quoting officials from both sides, said Carney is keen for Canada to become an “associate member” of the E.U.
“Canada is a strategically important partner for the European Union, and indeed a close friend,” the European Commission’s deputy chief spokesperson Olof Gill told reporters. “We deeply value this co-operation. You will recall that at our E.U.-Canada summit last year, we set a very high level of ambition for cooperation across the board, this year our ambition is even higher.”
TIME has reached out to the Canadian Prime Minister’s office for comment.
“Canada is already one of the most integrated non-European countries. It has the densest network of institutional relationships with the E.U.,” he tells TIME, referencing the Comprehensive Economic and Trade Agreement (CETA), a major free-trade deal between the E.U. and Canada, signed in 2016, and Horizon Europe, an initiative on collaborative research launched by European Union in 2021 and joined by Canada in 2024.
The European Economic Area (EEA) includes countries such as Iceland and Norway, which are not members of the E.U., and provides for the free movement of goods, services, and people within the E.U.’s member states, while enabling cooperation across multiple industries.
Burgeoning E.U. relationship comes amid deepening U.S.-Canada trade rift
At the World Economic Forum in Davos in January, Carney declared a "rupture" in the international rules-based order. He said "great powers" were using tariffs and financial systems as instruments of coercion. He did not directly name Trump or the U.S.
Patrick Leblond, an associate professor at the University of Ottawa, says Carney’s movements now are in response to the world “seeing a United States that is becoming more protectionist, nationalist, and willing to use its leverage points to gain concessions, including on very close allies like Canada and Europeans.”
These trade efforts, he continues, may allow Carney to “build momentum, and hopefully bring other countries” into a broader coalition of what the Canadian leader has often called “middle powers."
Championing middle power countries that possess significant economic power and diplomatic influence, but lack market or military power, the leaders implored: “In a rapidly changing world, we have the grit and the sisu to chart the path ahead—and we know that so have many others whom we invite to join us on this quest.”
“The first time we thought Trump was a blimp, but he's not, and we're looking at what's happening in terms of democracy and political polarization, and a lot of Canadians think we can't rely on the U.S.,” he says.
The E.U. has also clashed with Trump over tariffs, his Greenland annexation threats, and the wider split between the U.S. President and several European leaders.
Carney to address European Parliament
Carney’s highly-anticipated speech at the European Parliament in Strasbourg this week stems from an invitation extended by European Parliament president Roberta Metsola.
“I would expect that he will use that address to call on the E.U. to work with Canada to push this idea of co-operation beyond the North Atlantic and include partners and allies in the Indo-Pacific,” he says.
Von der Leyen called E.U.–Canada ties “one of the closest partnerships in the world” when she celebrated 50 years of E.U. diplomatic presence in Canada in May. She declared the two sides were “closer than ever” as they confronted wars, an energy crisis and “new fractures in old alliances.”
Schimmelfennig says Canada inching closer to the E.U. is a strong display of “how both partners are affected by the deteriorating transatlantic relationship” with the U.S. “They feel that they need to move together because the world is getting more dangerous, and more difficult for both [parties],” he says.
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