The Trade Zone

In this week’s edition: North America’s Critical Minerals Moment — and Canada’s Strategic Role

What will define Canada’s new relationship with Saudi Arabia

By John Stackhouse

A few years ago, Saudi Arabia and Canada were barely on speaking terms. Now they’re exploring trade deals, investment opportunities and, if plans come together, a visit to the Kingdom next year by Mark Carney.

In the Age of Trump, they’re among a host of mid-sized powers that are looking to carve out a new economic and geopolitical path.

Here’s what could redefine the Saudi-Canadian relationship: energy, including renewables, nuclear and EVs; advanced manufacturing, including drones and satellites; AI and quantum; mining and critical minerals; and advanced education and health care. The two countries also have a lot of capital to deploy, and a lot of capital that they need.

The rapidly evolving relationship was on display earlier this month when Saudi Investment Minister Khalid Al-Falih spent a day in Ottawa, with Carney and a range of senior ministers, and then a day on Bay Street. Less noticed but also important was Alberta Premier. Danielle Smith’s visit to the region, including Saudi Arabia, to promote energy technology and investment.

Here’s some of what may be worth watching in the coming months:

• Carney’s pitch for $1 trillion+ in new investment (most of it private capital) will need to include sources like Saudi investment funds and corporates;

• Saudi’s ambitions to diversify its energy sector—Al-Falih mentioned green and blue hydrogen, green ammonia and EVs—could use a lot more Canadian technology, talent and investment. The visiting Saudis met with Ontario autoparts makers, hoping they might want to be part of the Saudi ambition to make 600,000 EVs a year;

• Canadian manufacturers and producers, especially in agri-food, can be leading players in Saudi’s ambition to be a food hub for the Middle East and North Africa.

The week that was

• Ottawa is hoping to restart trade talks with India under a “new process,” said Canadian Trade Minister Maninder Sidhu. On a three-day visit to India, the Minister discussed critical minerals, clean energy, agriculture and artificial intelligence.

• In an effort to lower grocery bills, U.S. President Donald Trump is working lower tariffs on items like coffee and bananas into deals with a handful of Latin American countries. 

• The price of pasta from Italy, however, could skyrocket for Americans come January when the proposed 107% tariff on goods from 13 Italian companies is scheduled to begin.

• Canada’s forestry industry is planning to re-route about 10% of wood (enough to build 75,000 homes) that would normally go to the U.S. to the UK and Europe.

• Amazon and Microsoft threw their support behind the Gain AI Act, legislation that would require chip makers to satisfy U.S. demand before exporting to other countries, including China. Nvidia, which has been seeking access to the world’s second largest economy, view the act as an unnecessary intervention.

North America’s critical minerals moment — and Canada’s strategic role

By Shaz Merwat, Director of Energy Policy

A recent submission to U.S. Trade Representative Jamieson Greer from the Coalition for North American Trade (CNAT)—co-chaired by former U.S. House Ways and Means Chairman Kevin Brady, Canada’s former NAFTA lead negotiator Steve Verheul, and Mexico’s Ken Ramos—positions CUSMA as one of the continent’s most powerful tools for rebuilding critical-minerals security.

Key details from the filing:

• The U.S. remains 100 percent import-reliant for 16 critical minerals (including graphite) and over 50 percent reliant for another 29 such as rare earths, zinc, cobalt, and nickel.

• Canada is the U.S.’s primary import source for indium, nickel, potash, tellurium, uranium, vanadium, and zinc—and the second largest for copper, graphite, niobium, and tungsten.

The CNAT submission argues the CUSMA’s tariff-free architecture and co-production model are the ideal platform to accelerate re- and near-shoring of critical-minerals supply chains—from exploration and permitting to processing, refining, and battery-grade materials. Integrating Canada’s resource base with U.S. manufacturing strength and Mexico’s processing capacity fills a gap in critical-minerals collaboration to date, with most of the focus on G7+ allies.

For Canada, the strategic opening lies in deepening trilateral integration—leveraging CUSMA to attract investment, expand value-added processing, and align upstream resources with the broader North American production system to build a fully regional critical-minerals platform.