99% of Canadian exports to face zero tariffs under new UAE pact

The Comprehensive Economic Partnership Agreement between Canada and the United Arab Emirates was signed on Tuesday. The accord targets the reduction or elimination of tariffs on more than 99 percent of current Canadian exports to the Gulf state. Prime Minister Mark Carney and Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan presided over the ceremony.

The deal is part of a wider strategy by the Canadian government to secure new trading partners. This push follows a breakdown in negotiations with Washington, where US President Donald Trump’s tariffs have impacted the Canadian economy. Carney has set a goal to double Ottawa’s non-US trade over the next ten years.

According to the Prime Minister’s Office, the agreement will open new avenues for specific industries. These include farmers producing pulses and canola, manufacturers of industrial machinery, and the aerospace sector. The statement noted that the pact will also address non-tariff barriers to create a more predictable environment for investment.

The agreement is expected to enter into force in 2027. Alongside the main trade deal, both governments signed preliminary agreements covering energy, diplomatic cooperation, and defense. UAE Foreign Trade Minister Thani bin Ahmed Al Zeyoudi stated that the pact improves market access for exporters and offers investment opportunities in logistics, communications, advanced technology, and manufacturing.

The UAE is currently the largest Middle East market for Canadian goods. It is a major buyer of motor vehicles, parts, and machinery. Two-way trade between the two nations reached 3.5 billion Canadian dollars, or 2.48 billion US dollars, last year. Government data shows this figure has grown by 10 percent annually in recent years.

In a separate commitment, the UAE pledged up to 50 billion US dollars in investment in Canada last year. This financial support aligns with the broader objective of building a resilient and diversified economy. Maninder Sidhu, the Canadian Minister of International Trade, signed the agreement with Al Zeyoudi on behalf of their respective governments.