50 Percent: Tariff Rate Pushing Canada and EU to Montreal Summit
Leaders meet October 29 and 30 to finalize a new alliance framework as trade friction with Washington escalates.
By Ariana Flores ·
Canadian Prime Minister Mark Carney and European Commission President Ursula von der Leyen will meet in Montreal on October 29 and 30. The summit aims to strengthen economic and strategic ties between the two blocs while Canada’s relationship with the United States deteriorates. This gathering marks the 21st Canada-EU summit in history.
The agenda spans trade, technology, defence, energy, critical minerals, artificial intelligence, research, and financial services. A joint statement is expected upon the conclusion of the talks. The meeting builds on the Comprehensive Economic and Trade Agreement, known as CETA, which took effect in 2017. According to the European Council, CETA removes duties on up to 99 percent of goods traded between the partners.
European Council President Antonio Costa stated that the leaders will launch an Alliance for the Future. This initiative is designed to deepen political, economic, and institutional links. The timing reflects the impact of US President Donald Trump’s tariffs on exports from both regions. Before those tariffs, Canada sent nearly 80 percent of its exports to the US. In August, trade talks between Ottawa and Washington broke down. Trump subsequently imposed a 50 percent levy on $20 billion of Canadian goods, representing about 5.5 percent of Canada's total exports. Canada responded with equivalent tariffs on US steel, dairy, appliances, farm equipment, pulp and paper, and electronics.
Carney’s office noted that the EU offers market power, research depth, and manufacturing strength. In return, Canada provides abundant energy, critical minerals, capabilities in space, AI, and quantum technology, along with one of the world’s strongest banking systems. Vina Nadjibulla, co-founder and CEO of the Centre for Strategic Statecraft in Ottawa, expects specific announcements in these sectors. She noted that the main challenge is converting political momentum into concrete deals and projects quickly.
Defence represents a key area of convergence. The EU describes Canada as the only non-European country participating in Security Action for Europe, or SAFE. SAFE is a 150 billion euro loan programme that supports defence procurement by member states. An agreement reached in February grants Canadian firms preferential access in procurements financed under this instrument. In September, von der Leyen suggested Canada could become the EU’s first associate member. Carney welcomed the idea, describing his goal as a unique alliance rather than conventional membership. The Centre for European Policy Studies notes that the term does not exist in EU treaties or its standard enlargement framework.
Both sides have rejected the notion that the effort targets Washington. Von der Leyen told the European Parliament in Strasbourg that this is a partnership not against anyone else, but for our common strength. Carney attended the address as the first foreign head of government to do so. Nadjibulla described the move as diversification and resilience building, giving Canada more choices in an unpredictable world. Former Ontario premier and UN ambassador Bob Rae said talks with the EU are perfectly normal and not directed at the US.
Trump has threatened new tariffs on Europe over the proposal. In September, he told reporters in Charlotte, North Carolina, that if the intention is good it is fine, but if it is bad, the US will put very heavy tariffs on Europe. He also dismissed the prospect of Canada joining the EU as laughable and called Canada a terrible trade partner.
