Carney's European address will find an eager audience in a continent rattled by Trump

Carney's European address will find an eager audience in a continent rattled by Trump

PM to speak at European Parliament as Canada, EU appear poised to move closer

One of the drawbacks of giving a historic speech like the one that Prime Minister Mark Carney gave in Davos, Switzerland, in January is that people expect an encore every time you speak.

The Carney government has been at pains to lower expectations for anyone who's hoping for another worldwide viral moment when Carney addresses the European Parliament in Strasbourg, France, on Thursday morning.

There will be nothing that will really surprise those who've been following the prime minister's publicly expressed thinking, or the progress of the growing rapprochement between Canada and the European Union, one senior government official told CBC News.

And yet neither the Canadians nor the Europeans are downplaying the large expectations they have for an expanded EU-Canada alliance that goes far beyond the current Canada-European Union Comprehensive Economic and Trade Agreement (CETA).

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"Europeans looked very positively on him and on that speech in Davos," said Sven Simon, chair of the European Parliament's committee on constitutional affairs. "He nailed it. He put it really in the right direction. I think in those uncertain times, we, both the Europeans and Canadians, have a huge interest in closer co-operation."

Carney himself, while stressing that this trip is not the grand finale of a grand bargain, told Bloomberg News that he expects great things in the future.

"It's an exciting time. Look, it's not going to be solved this week in Strasbourg. This, to be clear, it's the start of a process, but it's the start of a high-ambition process."

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All indications are that both sides are heavily focused on the Canada-EU Summit scheduled for Oct. 29-30.

"I think that there is a significant step to be done in October because both parties would like to enhance or to elevate their relationship," EU Ambassador to Canada Geneviève Tuts told CBC's Power and Politics.

"We want to reimagine the relationship between the EU and Canada."

Hans-Gert Pöttering, a former president of the European Parliament who visited Canada last week, told CBC News that the Trump administration's treatment of Canada had shocked Europeans.

"There is somebody who wants to make Canada the 51st state of the United States. And all these crazy ideas, I think are the basis that we see how important Canada is for us," he said.

Both Canadian and European officials often say they want to work with "like-minded" allies, and for the Canadians, "like-minded" has increasingly come to mean "European," while for Europeans, it increasingly means "Canadian."

Both sides have poured cold water on any talk of Canada joining the EU. The Canadians say they aren't interested in the basic formula of EU membership under which countries give up some sovereignty in return for access.

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Canada is engaging with Europe in order to strengthen its sovereignty, not to dilute it, a senior official told CBC News.

The same official said that reporting in the Wall Street Journal that suggested Canada was looking to reproduce arrangements that non-EU members such as Norway have with the union — which do involve some concessions on sovereignty — are false.

No name yet to define the relationship

European officials also say they envision an alliance between the EU and Canada, rather than an amalgamation. But the partnership they envision would go further than the current relationship with the United Kingdom.

Germany's David McAllister, who chairs the foreign affairs committee of the European Parliament, told CBC News that neither side had yet paid much attention to labels — but stressed the EU is not trying to get Canada to surrender sovereignty

On the contrary, McAllister, who trained in Manitoba at CFB Shiloh as a young soldier in the German Army, said Europe was willing to collaborate with Canada to protect itself from U.S. threats.

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"We in Europe understand that threats and economic pressure against an ally simply damaged the trust which we need among transatlantic allies," he said. "That's why the U.S.-Canadian dispute, which President Trump is responsible for, has received such wide media coverage all over Europe."

On the trade front, 99 per cent of commerce between Canada and the European Union is already tariff-free. Both sides speak about the importance of getting 10 holdout countries, including France and Italy, to ratify CETA, but that's mostly symbolic.

Canada is also already integrated into two vital pan-European projects: the Security Action for Europe (SAFE) program that provides low-interest loans for joint military procurement and the Horizon program that funds scientific research.

But both sides say there are areas of co-operation that remain under-exploited or even unexplored.

There have been signs of openness to increased labour mobility, although it's very unlikely that would go as far as the full freedom of movement that exists in the EU.

Two areas appear to be of greatest interest. The first is to use the free trade framework that already exists to build a genuine synergy between Canada's natural resource and energy wealth, and Europe's large market and manufacturing capacity, to the benefit of both economies.

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CETA "is actually a fantastic framework, but we are not fully using it either in Europe or in Canada," said Tobias Cremer, who sits on the foreign affairs and defence committees of the European Parliament.

"A lot of our especially medium- and small-sized companies don't even know the potential we have. Canada has all this potential, but the infrastructure for instance isn't actually set up yet to go across the Atlantic."

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Both Carney and the Europeans often point out that Europe — large and rich but resource poor — and Canada — lightly populated but resource and energy-rich — complement one another naturally. That is not always as evident in the U.S.-Canada relationship where, in any case, the current U.S. administration views Canada more as a rival than a partner.

A second avenue is to combine forces in sovereignty-protecting projects that would be difficult for Canada to do on its own.

In his interview with Bloomberg, Carney said that "sovereignty is determined by where you stand in a series of strategic capabilities in space, obviously in AI, in sovereign computing, in critical minerals, in energy."

Carney also mentioned financial payments as a potential vulnerability, one of "those interconnections, that integration [that] can be used as leverage against you."

China has long viewed dependence on the U.S. dollar and the U.S.-based SWIFT system for international payments as a weakness, and sought to "de-dollarize" not only its bond holdings but also its trade with other countries. India, Brazil, Saudi Arabia and the U.A.E. have all set up new facilities for trading payments to avoid the dollar and go around U.S. banks, and increasingly, traditional U.S. allies are thinking along the same lines.

The U.S. would likely perceive any move by Canada and Europe to cut SWIFT out of their trading arrangements as another threat to a U.S. dollar that is already losing ground as the world's go-to currency for trading and saving.

Planning and stockpiling together

Building sovereign resilience could also involve holding shared stockpiles of essentials. The pandemic, as well as transportation bottlenecks in the Strait of Hormuz and Suez Canal, and the trade disruptions of the Trump era have moved governments away from the just-in-time delivery mentality of a decade ago to one of planning and hoarding.

"We're hearing talk in Canada about stockpiling raw materials," said Mark Camilleri, Brussels-based president of the Canada EU Trade and Investment Association. "Maybe there's a way that we can work together in a trusted manner, in a more efficient way, in what's becoming a very inefficient world."

Canada is sending a message to the Trump administration, says Brian Clow, former prime minister Justin Trudeau's chief adviser on the Canada-U.S. relationship: "We can sell elsewhere. We can have security partnerships elsewhere."

"Both Europe and Canada are under attack, frankly, by the United States on our economy, on our sovereignty, and that is pushing us closer together," said Clow.

For the Carney government, Europe is not only a place to trade, but also a potential replacement partner with which to integrate sovereign networks, launch satellites, stockpile critical minerals and build a strong defence manufacturing base, or as Carney put it to Bloomberg, a place to "deepen co-operation with like-minded partners so you have sovereignty, so you have resilience, so you have independence.

"No country can do that alone."

Evan Dyer has been a journalist with CBC for 25 years, after an early career as a freelancer in Argentina. He works in the Parliamentary Bureau and can be reached at evan.dyer@cbc.ca.