Prime Minister Mark Carney is proposing what is (by intention, if not yet by result) the largest reorientation of Canadian foreign and trade policy in at least 40 years, since his predecessor Brian Mulroney began working on the Canada–United States Free Trade Agreement. Spurned by a US government that no longer sees the wisdom in free trade with its largest trading partner, Carney wants Canada to pivot to Europe. And the federal government is now working to sell Europeans on the idea that investing here and selling Canada’s goods and services is at least a partial answer to problems plaguing their countries.
He could fail. But even if he succeeds, Carney’s plan is going to run headfirst into two problems: he’s going to need provincial agreement to accomplish what he wants, and at least some of the country’s premiers — very much including Ontario’s Doug Ford — have very publicly backed closer ties with the US.
Last weekend, the Wall Street Journal published what is so far the most expansive reporting on Carney’s plan. It mentions the possibility that Canada could be granted some kind of not-quite-membership to the EU — something that caused a bit of a political tizzy among federal conservatives and caused Carney’s office to state that it’s simply not happening. But EU membership is frankly less interesting than the more concrete and practical measures that are apparently up for discussion.
“European and Canadian officials are eyeing ways in which Canada could informally lock into Europe’s $21 trillion single market in strategic supply chains such as energy, AI, the critical minerals needed for batteries or semiconductors and, most urgently, defense,” the Journal reports. Defence is, of course, a federal matter. But everything else on that list is a matter of at least partial provincial jurisdiction.
Critical minerals? The provinces have constitutionally guaranteed control over their mineral resources. The same is true of energy, whether you’re talking about oil and gas or renewable electricity. Artificial intelligence? While much of the internet is federally regulated, the actual siting and construction of data centres is subject to provincial controls over land use, which are administered by municipalities (that’s why these battles are playing out in city-council meetings around Ontario). Regulations around electricity consumption for large industrial users like those same data centres? Also fall within Ontario’s purview.
The prime minister can make any agreement he wants with foreign nations, but no agreement, on its own, can alter Canadian domestic law. If one calls for changes to Canadian federal law — which covers things like banking, broadcasting, aviation, etc. — Carney can bring those to the House of Commons in a bill and use his majority to pass them. But the federal government cannot, by treaty, change the division of powers in the Constitution. (This precedent, which goes back to the 1937 Labour Conventions Reference, was reaffirmed as recently as the 2021 carbon-tax decision.) If there’s going to be a pivot to Europe along the lines described, Carney will need to find a way to bring the premiers along.
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To be clear, this won’t be news to any of the principal actors involved. Back when a previous federal government was negotiating the Canada-European Union Comprehensive Economic and Trade Agreement, the Europeans were well aware that federal policy could be thwarted by provincial interests, and they worked hard to get provinces onside. And, indeed, prior reporting from Bloomberg stressed that bringing the provinces into the loop has been part of Carney’s plan.
The problem isn’t procedural — it’s political. It’s not just that Carney will need to get support from the premiers for his agreement; it’s that at least some of them are deeply skeptical of the entire notion. Our economies really have been structured over decades of free trade such that huge numbers of jobs depend on the resumption of normal relations with the US. The year-plus run of insults and attacks from south of the border hasn’t changed that. In this context, Carney’s European pivot is at best a distraction and at worst a deliberate provocation, one that will make a return to the status quo ante even more difficult.
Ford is a pretty clear case of exactly this tension. On the one hand, the premier clearly welcomes Carney’s emphasis on bringing foreign investors to Canada: his office released a statement on Sunday praising this week’s Canada Investment Summit, which saw Carney welcome global investors with a national “pitchbook” of projects looking for money. But Ford has also spent the past year and a half fruitlessly urging American policymakers to rediscover the virtues of an integrated continental economy: last year, there was his “Fortress Am-Can” pitch, which was later rechristened “Fortress North America,” as it turned out abandoning Mexico gained us zero advantage.
These aren’t just differences of opinion: Carney can afford to see the big picture (not least because of the extraordinary levels of public support he enjoys currently), but Ford really does have a manufacturing sector whose long-term future depends to a great extent on the resumption of easy access to the US market. For it, increased opportunities in Europe are largely speculative. To repeat something I’ve said previously: it’s true that Canada could, in theory, enjoy a prosperous future trading with partners beyond the US — but that future might not include Ontario’s auto sector at anything like its current size.
Carney and Ford have forged a strong working relationship since the twin elections of early 2025, notwithstanding some island airport–shaped hiccups. They have, at times, played the roles of good cop and bad cop in our response to US economic warfare. But events can fracture even the strongest relationships. And if anything could fracture “Team Canada,” it would be two diametrically opposed visions of the country’s economic future.