Canada and the United Arab Emirates have signed a comprehensive trade deal aimed at cutting tariffs, reducing red tape and boosting investment, as Prime Minister Mark Carney accelerates his push to diversify Canadian trade away from the United States. Carney and Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan presided over the signing of the Comprehensive Economic Partnership Agreement (CEPA) in Ottawa on Tuesday. Canada’s International Trade Minister Maninder Sidhu and the UAE’s Foreign Trade Minister Thani bin Ahmed Al Zeyoudi signed the agreement. Once fully implemented, the deal will reduce or eliminate tariffs on more than 99 percent of current Canadian exports to the UAE, the Prime Minister’s Office said, and is expected to enter into force in 2027.
What the deal covers
The agreement covers about 99 percent of the total value of existing bilateral trade and 97 percent of all tariff lines, according to Al Zeyoudi. It addresses non-tariff barriers and aims to create a more predictable environment for trade and investment. Canadian farmers growing pulses and canola stand to gain, along with manufacturers of industrial machinery and power generation equipment and the country’s aerospace sector. Market access also expands for goods and services in industrial, agricultural, forestry, fish and seafood, environmental and engineering sectors. UAE exports to Canada — including iron, aluminium, metals, gold, certain electronic products, pharmaceuticals and food products — will likewise benefit, with opportunities for further manufacturing and re-export to global markets. The deal was concluded in a record 47 days of negotiations, the shortest time either country has taken to finalise a free trade agreement, according to the Prime Minister’s Office.
The economic prize
The UAE expects the agreement to add about US$8.7 billion to its gross domestic product and lift UAE exports to Canada by about US$11.8 billion by 2033, Al Zeyoudi told the Emirates News Agency (WAM). It is the first CEPA the UAE has signed with a G7 member country. Bilateral trade is already growing fast. Non-oil trade between the two countries reached about US$4.2 billion last year, up more than 22 percent, and grew a further 18 percent in the first half of this year. Two-way merchandise trade totalled C$3.5 billion (US$2.48 billion) in 2025, according to Canadian government figures, making the UAE Canada’s largest export market in the Middle East.
Part of a wider diversification drive
The signing is the latest step in Carney’s pledge to double Canada’s non-US trade over the next decade. US President Donald Trump’s tariffs have rippled through the Canadian economy, and subsequent attempts at a deal with Washington have broken down, pushing Ottawa to pursue agreements across Asia, Europe and the Middle East. The visit also marked the first time an Abu Dhabi crown prince has visited Canada, and came with further progress on the UAE’s commitment to invest C$70 billion (US$50 billion) in Canada, announced during Carney’s visit to Abu Dhabi in November 2025. Alongside the trade deal, the two countries signed preliminary agreements on energy, diplomatic and defence cooperation, and announced plans to begin negotiations on an extradition treaty and a mutual legal assistance treaty.
Why it matters
For Canada, the deal is a concrete piece of its post-tariff diversification strategy: a signed agreement, with a 2027 start date, opening a fast-growing Gulf market to its farmers, manufacturers and aerospace firms. For the UAE, it is a first-of-its-kind G7 trade pact that deepens its access to North American markets and supply chains. The projected gains are forecasts, not guarantees — but the tariff cuts themselves, once in force, are real and immediate for exporters on both sides.
What is confirmed — and what is not yet known
Confirmed: the signing in Ottawa on 27 October 2026; the signatories and witnesses; tariff coverage of over 99 percent of current Canadian exports; expected entry into force in 2027; the 47-day negotiation record; the C$70 billion investment commitment context.
Not yet confirmed: the deal’s ratification timetable in either country, and whether the projected GDP and export gains to 2033 materialise — those figures are official projections, labelled as such.
FAQ
What is the Canada-UAE CEPA?
The Comprehensive Economic Partnership Agreement signed in Ottawa on 27 October 2026, cutting tariffs and non-tariff barriers between Canada and the United Arab Emirates.
When does the deal take effect?
It is expected to enter into force in 2027, after ratification steps in both countries.
Which Canadian exports benefit most?
Pulses and canola, industrial machinery, power generation equipment, aerospace products, and goods and services in forestry, seafood, environmental and engineering sectors.
Sources
- Reuters via BusinessWorld — https://bworldonline.com/world/2026/10/28/789861/canada-uae-sign-trade-deal-as-carney-seeks-new-trading-partners/
- WAM — https://www.wam.ae/en/article/c2yy63i-uae-canada-cepa-add-87-gdp-boost-exports-118-2033
- WAM — https://www.wam.ae/en/article/c2yy5xk-crown-prince-abu-dhabi-prime-minister-canada
- Hürriyet Daily News — https://www.hurriyetdailynews.com/canada-signs-uae-trade-pact-to-diversify-exports-228692
- Qazinform — https://qazinform.com/news/canada-and-uae-sign-free-trade-agreement-to-strengthen-economic-ties-f182f7
