Canada strengthens German trade ties to cushion U.S. tariff fallout

Canada is expanding its trade and defense relationship with Germany as a direct response to growing tariff threats from U.S. President Donald Trump, according to reporting from the Parliament Hill press briefing.

Prime Minister Mark Carney is heading to Berlin this week, where he will meet German Chancellor Friedrich Merz to strengthen economic cooperation and reduce the country’s reliance on American markets.

“There’s a broad range of areas, from critical minerals to energy and defense and security, where we are intensifying our discussions with Germany,” Carney said Friday during a press conference.

He will be joined in Berlin by Cabinet members handling defense, industry, and trade. The visit is being treated as a coordinated economic strategy, not a symbolic diplomatic stop.

Carney told reporters that Trump’s aggressive trade policy is leaving Canada with no choice but to form new international partnerships. “Canada must be looking elsewhere to expand our trade, to build our economy and to protect our sovereignty,” he said earlier this year. “Canada is ready to take a leadership role in building a coalition of like-minded countries.” The Berlin visit is one part of a larger push across Europe that began this week.

Ministers spread across Europe to build new alliances

Before Carney’s trip to Germany, Industry Minister Mélanie Joly traveled to Sweden and Finland. Foreign Affairs Minister Anita Anand met with Nordic NATO members in Finland as well. The entire Cabinet’s moves are part of an organized effort to build deeper ties with European countries amid deteriorating trade certainty with the U.S.

In Berlin, Defense Minister David McGuinty will meet German Defense Minister Boris Pistorius to discuss military cooperation. Natural Resources Minister Tim Hodgson will engage directly with German executives from defense, energy, and manufacturing sectors. Hodgson is also scheduled to speak at the Canadian embassy in Berlin to a business audience about economic cooperation.

“It’s really a trade mission focused on energy and critical minerals,” a Canadian government official said, granted anonymity to speak about the plans. The official also described Germany as “one of the priority markets” in the European Union, noting its position as the continent’s largest economy.

Germany is looking to Canada’s mineral supply for its clean energy and electric vehicle industries. As a NATO member, Germany also needs stable sources to support its ramp-up in military hardware spending, targeting 5% of its GDP to meet new alliance commitments.

Canadian minerals are being considered essential to that effort. Germany is also still working to fully disconnect from Russian gas supplies, which adds urgency to the trade discussions.

Energy talks include hydrogen corridor and rare earth investment

Hodgson will also follow up on the Canada-Germany Hydrogen Alliance, which was signed in 2022. That agreement aimed to start hydrogen deliveries across the Atlantic by this year. “We’ve been working very hard with them for the last several years on a transatlantic hydrogen corridor,” the same official said. No further updates were provided on when those shipments will begin.

Another major issue on the table is China’s control over critical minerals. Germany wants to diversify its supply chain to avoid relying on Chinese exports. Canada is pitching itself as the alternative and is willing to take German capital to move projects forward. “Canada has a lot to bring to the world stage, but that also requires catalyzing investment,” the official said. “We are open to German investment in Canadian projects, if those will help get projects off the ground.”

Carney said the upcoming meeting in Berlin builds on the earlier conversations he had with Merz during the G7 summit held in Alberta. They will also be discussing Ukraine during this visit, just as Carney has with other global leaders in recent months. “I have had conversations about this, including with President Trump, in the last few weeks. We are making progress,” Carney said. He described the talks around Canada’s future involvement in Ukraine as a “delicate” issue.

Despite the rising tensions, Trump said on Friday he still wants a good relationship with Canada. “I want to be very good to Canada,” he said from the Oval Office. “I like Carney a lot. I think he’s a good person.” Trump’s statement came after Carney had already made it clear that Ottawa won’t sit around waiting for the next set of tariffs to hit.

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