The EU currently lists six official trade barriers in Canada. Introducing new trade restrictions contradicts the spirit and goals of CETA. The EU and Canada should thoroughly eliminate existing trade barriers and avoid creating new ones. Particularly burdensome are the luxury tax on vehicles introduced in 2022, the Buy-Canada regulations in public procurement set to start at the end of 2025, and the recent tariffs on selected steel and agricultural products (canned vegetables). These measures complicate European companies' market access despite an existing free trade agreement. The EU should prioritize the removal of these trade barriers in bilateral dialogue. In particular, European companies should be exempt from discriminatory procurement rules, and existing tariff measures on EU goods should be withdrawn.

Discrepancies in product standards and regulatory recognition between Canada and Germany or the EU remain challenging, as technical standards, approvals, product regulations, and partially also testing and conformity procedures are not fully harmonized. Specifically, in the automotive sector, more mutual recognition and alignment of Canadian rules with EU standards are needed to reduce duplicate testing, additional costs, and market entry barriers.

The trade agreement between the EU and Canada (CETA) provides a solid framework for the trade of goods and services, as well as for cross-border investments and public procurement. Since its provisional entry into force nine years ago, trade in goods has increased by 76 percent to over 81 billion euros. Trade in services has risen by 97 percent to almost 51 billion euros. This demonstrates the contribution that rules-based trade agreements can make to growth, competitiveness, and economic resilience.

CETA provisionally came into force in 2017, meaning that most chapters of the agreement now apply. The parts that are not yet in effect mainly include portfolio investments and investment protection. CETA eliminates tariffs on 99 percent of all tariff lines, 98 percent of which were abolished when it provisionally entered into force.

Currently, 17 EU member states have completed their national ratification processes for CETA. The remaining ten EU member states should now swiftly ratify CETA: Belgium, Bulgaria, Cyprus, France, Greece, Hungary, Ireland, Italy, Poland, and Slovenia. Full ratification would create additional investment security, enhance legal certainty, and send an important economic policy signal for open markets.

The preference utilisation rate (PUR) of Canadian imports from the EU has gradually increased to 62.4 percent by 2023, whereas the EU's preference utilisation on imports from Canada peaked at 66.5 percent in 2021, but slightly declined to 58.3 percent in 2023. PURs varied across EU member states and product categories, with lower rates observed in sectors where tariff preferences fell below 5 percent. Key sectors where tariff savings went unused included automobile products, ships, boats, floating structures, furniture, and clothing. Particularly for SMEs, the demanding verification requirements related to preferences often pose a hurdle. In practice, this associated effort occasionally leads to the non-utilisation of existing preferences, contributing to suboptimal usage of trade preferences under CETA. Therefore, the EU and its member states should significantly enhance practical support concerning rules of origin, verification requirements, and customs procedures. The primary goal must be to substantially increase the actual use of existing market openings. At the same time, it is clear that the low utilisation of preferential rights is a fundamental issue in many modern trade agreements. Hence, a general review of existing and new EU trade agreements is necessary to simplify rules of origin and verification requirements, ensuring they cater more effectively to the practical needs of SMEs.

The bilateral dialogue on automotive regulations should be utilised to evaluate the impact of Canada's luxury tax on electric vehicles and the practical implementation of CETA's rules of origin within the automotive sector.

Moreover, the transparency of subnational public tenders should be significantly enhanced to provide European companies with fairer and simpler market access. Consolidated data on the scope and outcomes of public procurement at sub-federal levels in Canada remain incomplete or unavailable. This leads to inefficiencies and a lack of transparency for businesses. Canada is currently consolidating procurement data under the "CanadaBuys" framework. However, some provinces continue to use "mRex" instead of "CanadaBuys", limiting opportunities for obtaining competitive procurement statistics.

The EU is the world's leading exporter and importer of digital services. On March 6, 2026, the EU and Canada initiated negotiations for a digital agreement, anticipated to be concluded by the EU-Canada Summit in autumn 2026. The agreement is expected to enhance legal certainty for businesses by improving paperless trade, recognizing electronic signatures, contracts, and invoices, and prohibiting tariffs on electronic transmissions. Strengthened collaboration in digital sovereignty, including open-source and interoperable standards to reduce strategic dependencies, is also on the agenda. Furthermore, a digital agreement is pivotal for enhancing the German-Canadian Digital Alliance on artificial intelligence, digital sovereignty, digital infrastructure, quantum technologies, and networking tech startups and companies.

Canada is a key participant in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). The EU should push forward an EU-CPTPP 'coalition of the willing,' dedicated to market openness, maintaining and advancing global trade rules. Together, the 27 EU countries and the twelve CPTPP nations—Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United Kingdom, and Vietnam—represent 37 percent of global trade, surpassing the combined share of the United States and China. The EU and CPTPP should prioritise WTO reform, shared digital and origin rules, and collaboration on supply chain security. The EU-Canada digital agreement could serve as a model for future EU-CPTPP cooperation.

The German economy is increasingly under pressure due to the instrumentalisation of economic interdependencies and dependencies. The rise in export restrictions on critical raw materials – including rare earths, hard metals, as well as technology and battery raw materials – underscores the necessity to make the supply of raw materials for the German economy more resilient, competitive, and sustainable. Close cooperation with Canada in critical raw materials, energy, and resilient supply chains is becoming all the more important. It strengthens supply security, safeguards Germany's industrial competitiveness, and forms the foundation for the future of key industries such as battery technology, high-tech production, and industrial transformation.

Canada is a central partner for the EU in reducing strategic dependencies and diversifying critical supply chains. Canada possesses 22 of the 34 raw materials classified as critical by the EU Commission and the German government. However, currently, only about 1% of Canada's mineral raw material exports go to Germany. Canada’s 2022 mineral strategy presents numerous opportunities for diversification and deeper collaboration with the German economy. To strengthen and expand German-Canadian cooperation on raw materials, concrete projects in partnership with the business sector are required.

The development of new Canadian capacities for raw material extraction, processing, and recycling can open up new procurement, export, and innovation opportunities. Significant potential lies particularly in expanding local processing and refining capacities for critical minerals, allowing Canadian raw materials to be utilised at higher value, maintaining value creation in Canada, and simultaneously enhancing the supply security of Europe's key industries. Several collaborations between German and Canadian partners in the raw materials sector have already been agreed upon and should continue to be supported. Furthermore, the potential for additional cooperation opportunities for the economy, in the light of Canada's efforts to build up its raw material reserves, should be explored.

To enable closer collaboration in the raw materials sector, Germany’s and Canada’s financing instruments must be more closely aligned. Institutional exchange and cooperation between German and Canadian organisations – such as the KfW, KfW IPEX, Export Development Canada, Invest in Canada, the Canada Growth Fund, pension funds, and others – should be deepened. Moreover, it should be examined to what extent approaches such as "Blended Finance" can facilitate a stronger involvement of private capital in joint projects. To promote faster cooperation and investments, mutual recognition of due diligence evaluations should be considered to enhance operational efficiency.

The energy partnership between Canada and Germany was established in 2021 by the governments of both countries to strategically promote bilateral cooperation in the energy sector and coordinate joint projects. The current action plan focuses on clean energy and technologies, the expansion of the Canada-Germany Hydrogen Alliance, as well as collaboration in raw material security for the energy transition and climate protection. Canada offers significant potential as a partner for clean hydrogen, LNG, renewable energy, and climate-friendly energy technologies. For the successful diversification of the European energy supply, Canada holds strategic importance. However, transport and export infrastructure, particularly for direct transport of hydrogen (or its derivatives) and LNG to the EU, would need to be developed in many regions. The long-term goal should be to establish robust transatlantic energy and hydrogen corridors that equally support supply security, decarbonization, and industrial competitiveness.

The EU and Canada should forge a comprehensive economic security agreement.

This agreement should encompass early warning mechanisms for resilient supply chains and the deepening of the EU-Canada partnership on raw materials. It should also include an agreement to refrain from implementing economic coercion measures, particularly export restrictions on sensitive goods in areas like energy, critical raw materials, medical supplies, and food. Additionally, state transparency and notification obligations regarding export controls should be established—perhaps in the form of a code of conduct. Institutional agreements should also be made for close cooperation in export controls, investment screenings, trade protection measures, and anti-coercion actions.

With great interest, the German economy is closely monitoring the discussions on the future of the US-Mexico-Canada Agreement (USMCA, referred to as CUSMA in Canada). The renegotiation must not lead to the isolation of the North American economic area from European companies. A possible termination of the agreement would particularly affect German companies that depend on closely intertwined supply chains in North America. Increased alignment of Mexico's and Canada's trade policy measures with those of the USA could also make market access more difficult for German businesses in the future. For instance, the recent rise in steel tariffs in these countries to the level of US external tariffs already restricts foreign trade — partly even with the EU. The EU should insist on compliance with the agreed agreements.

The EU and Canada should significantly facilitate the mobility of skilled workers, trainees, and young talents by simplifying, accelerating, and making visa and secondment procedures more predictable. At the same time, there needs to be more mutual recognition of degrees and professional qualifications, so that qualifications are measured not by administrative hurdles but by actual competencies. Additionally, both sides should expand more exchange programmes for young professionals, research, and professional practice in order to strengthen skill profiles, networks, and innovation cooperation at an early stage.

The expansion of research and innovation cooperation should remain a central element of bilateral relations. The participation of Canada in Horizon Europe and its accession to the Erasmus+ Youth Mobility Programme are explicitly welcomed. On 3 July 2024, Canada joined Pillar II of "Horizon Europe." In this context, it is necessary to comprehensively promote the closest possible research collaboration. Significant economic opportunities also exist in the fields of security and defence, as well as space, for collaboration between the EU and Germany with Canada. The EU and Canada should also strengthen their cooperation in ports, shipping and maritime logistics, for example, with regard to developing climate-neutral shipping corridors between Europe and Canada.

In the field of steel and aluminium, the EU and Canada, together with like-minded partners, should advance an open metals club that allows non-discriminatory trade among members and strengthens the resilience of supply chains.

The negotiations on a German-Canadian strategic partnership agreement should be concluded quickly. The agreement should lead to concrete and economically tangible results. Significant potential exists for enhanced collaboration in the areas of security and defence, technology, artificial intelligence and space, supply chains and critical raw materials, energy, and investments. These should be translated into robust projects, simplified cooperation structures, and improved conditions for businesses.

Furthermore, Canada should support stronger institutional integration of the EU in cooperation in the Arctic region and an EU accession to the Arctic Council.