Expanded trade with the EU does not hinge on an ‘associate member’ designation for Canada

Everyone, take a deep breath. The European Union is not spurning Canada.

Read that thrice because Canadians, especially business leaders, cannot afford to lose perspective about the two-day Canada-EU summit in Montreal that wraps up on Friday.

Yes, the EU has scrapped the idea of designating Canada as an “associate member” of the 27-member economic bloc in its joint communiqué after it received objections from major economies, including Germany and France. But the collective goal remains the same: forging stronger ties, including through expanded trade and investment.

“The new alliance is not a marketing exercise,” Prime Minister Mark Carney, who is hosting the summit, said on Thursday. “The name doesn’t matter.”

Truth.

This is not a case of unrequited love. The Europeans reciprocate our affection. The EU countries raising objections about the title are just defending their national interests.

Canada should do the same. That requires frank conversations and the discernment to take a long-term view of the Canada-EU relationship. Business opportunities already exist in both markets, so diversifying trade does not hinge on a label.

“My strong recommendation to the Canadian public, as a diplomat and as an observer of Canada-EU relations, would be not to limit yourself, or themselves, so much to the nitty-gritty of the negotiation,” Alessandro Cattaneo, Italy’s Ambassador to Canada, said in an interview on Wednesday. “It’s very important that this relationship evolves in the right way.”

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As he points out, Canada and EU countries must follow their own parliamentary procedures if any agreement is reached. Guardrails exist for good reason.

Italy reportedly raised its own concerns about the summit’s draft joint declaration, apprehensions that centred on competitiveness and technological sovereignty as they pertain to the energy transition, according to Euronews.

Mr. Cattaneo declined to comment on that report or share Italy’s official position on the “associate member” designation. Importantly, he stressed the final version of the EU-Canada joint statement is “extremely robust and unequivocal in its vision” for stronger relations.

He’s right that we need to avoid any misperceptions.

“There is a widespread awareness across the European Union of the potential of the relations with Canada – a potential that is twofold,” Mr. Cattaneo said.

“On one side, it has to do with the basics of the economic equation. Canada has so much to bring to this relationship in terms of energy, critical minerals, the development of its own economy through infrastructure, defence … But it has also very much to do with values.”

Shared values, such as democracy and individual freedoms, coupled with existing membership in NATO and the G7, also have economic implications, he said.

“You need to preserve the integrity of the supply chain, you need to operate among trusted partners. For all these reasons, the value element does not only belong to the world of politics and political relations.”

There is another issue that Mr. Cattaneo said has been “lost in translation.”

Although Italy is among the 10 EU countries that have not fully ratified the Canada-European Union Comprehensive Economic and Trade Agreement, or CETA, the pact has been provisionally in force since Sept. 21, 2017. That means tariffs have been removed from the vast majority of Canadian imports.

Bilateral merchandise trade between Italy and Canada was worth $17.6-billion in 2025, marking a 77.6-per-cent increase from pre-CETA levels in 2016. Pharmaceuticals, precious stones, metals and cereals were among Canada’s top exports to Italy last year.

Italian companies are also making investments in Canada, including Eni’s equity stake in Nouveau Monde Graphite Inc. and Enel Group’s wind turbine projects in Alberta. Prysmian S.p.A., an Italian wire and cabling company, meanwhile, has operations in Canada and is a supplier to Hydro-Québec.

There are also opportunities for Canadian companies in Italy because the two countries have complementary strengths. Italy’s manufacturing prowess, for instance, can be used to transform Canada’s raw materials.

“There are a lot of innovative companies in Italy around the chemical side and the engineering side that can come in and really help us advance faster into processing our minerals,” Hugues Jacquemin, CEO of Northern Graphite Corp., said in an interview on Thursday.

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Ottawa-based Northern Graphite owns North America’s only operating natural flake graphite mine, which is in Lac des Îles, Quebec. Graphite is a component of lithium-ion batteries.

Last year, Northern Graphite signed an agreement with Italian chemical giant Alkeemia S.p.A. to secure access to its graphite purification technology.

“We mine in Canada, but we can process using Italian expertise,” Mr. Jacquemin said. “And we can process in Italy and use Italian expertise to do that.”

This is why strengthening commercial ties with the EU is not dependent on Canada securing an “associate member” designation.

“The label is not important,” Mr. Jacquemin said. “It’s the political will that’s important, and it’s there.”

Exactly.