The announcement came during an investment summit in Toronto, where Carney addressed global financial leaders before departing for a series of high-level meetings in Europe. He is scheduled to speak before the European Parliament, signaling the urgency of the diplomatic outreach. The proposed partnership aims to integrate Canada into the EU’s $20 trillion single market across critical supply chains, though officials stop short of pursuing full membership or common market status.

This strategic shift follows a breakdown in trade relations between Ottawa and Washington. After tariff negotiations collapsed last month, both nations implemented retaliatory duties on exports. Despite the friction, Carney emphasized that Canada remains committed to its partnership with the U.S., framing the new European initiative as a way to build a more resilient and independent Canadian economy. The groundwork for the alliance will be solidified during a planned summit in Montreal, following a stop in Liverpool for discussions with U.K. Prime Minister Andy Burnham.