Canada and UAE signed a trade pact negotiated in 47 days

The signing

Prime Minister Mark Carney and Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan presided over the ceremony. International Trade Minister Maninder Sidhu and UAE Foreign Trade Minister Thani Al Zeyoudi signed the text.

The Prime Minister's Office said negotiations took 47 days, the shortest time either country has taken to conclude a free trade agreement. The visit was the first by an Abu Dhabi crown prince to Canada.

The two governments also signed preliminary agreements on energy and diplomatic cooperation, along with a memorandum on defence cooperation and a memorandum on diplomatic training. The defence memorandum covers military education and training, defence policy dialogue, joint exercises, defence industrial cooperation, cybersecurity and information exchange, and creates a Joint Military Committee to oversee implementation, the two governments said.

Al Zeyoudi said it was the first CEPA the UAE had signed with a G7 member. He said work with other G7 countries had been completed, but Canada was the first to sign.

What the deal covers

Once fully implemented, the agreement will reduce or eliminate tariffs on more than 99% of current Canadian exports to the UAE, the Prime Minister's Office said. It will also address non-tariff barriers and expand market access for Canadian goods and services in industrial, agricultural, forest, fish and seafood, environmental and engineering sectors.

The office said the deal opens markets for farmers growing pulses and canola, for makers of industrial machinery and power generation equipment, and for aerospace firms.

Al Zeyoudi put the coverage at about 99% of the value of existing bilateral trade and 97% of tariff lines. He said the agreement would benefit existing UAE exports to Canada including iron, aluminium, metals, gold, certain electronic products, pharmaceuticals and food products.

Trade and investment

Two-way trade was worth C$3.5 billion (US$2.48 billion) last year and has grown about 10% a year in recent years, according to government data. The UAE is the largest Middle East market for Canadian exports and a major buyer of motor vehicles, parts and machinery.

Al Zeyoudi cited a different measure: non-oil trade of about US$4.2 billion last year, up more than 22%, with 18% growth in the first half of this year compared with the same period a year earlier.

The UAE pledged up to US$50 billion, or C$70 billion, in investment in Canada during Carney's visit to Abu Dhabi in November 2025. Sidhu said the pledge could create more than 100,000 Canadian jobs, with investment focused on logistics, infrastructure, energy, critical minerals and artificial intelligence.

Al Zeyoudi told the Emirates News Agency that companies from the two countries are negotiating deals worth about US$15 billion. He projected the CEPA would add about US$8.7 billion to UAE GDP and lift UAE exports to Canada by about US$11.8 billion by 2033.

Why it matters

Carney has pledged to double Canada's non-US trade over the next decade. Attempts to reach a trade deal with Washington have broken down as US President Donald Trump's tariffs rippled through the Canadian economy.

Sidhu described the UAE as a gateway to a Middle East and North Africa market of nearly 500 million people and more than US$7.2 trillion in GDP. Al Zeyoudi said Canada sees the UAE as an entry point to the Middle East and Africa, while the UAE sees Canada as a route into the US market.

What happens next

The CEPA does not take effect yet. A Canadian government source said the signing was the last step before Canada's Parliament can ratify the agreement, and entry into force is expected in 2027.

The two countries said they will open negotiations toward an extradition treaty and a mutual legal assistance treaty. Carney said the two countries had brought an investment protection agreement into force in less than a year. The leaders also launched a strategic partnership covering the economy, energy, technology, education, defence, diplomacy and culture.