Canada and the United Arab Emirates signed on Oct. 27 a Comprehensive Economic Partnership Agreement that, once implemented, will reduce or eliminate tariffs on more than 99% of current Canadian exports to the UAE, with entry into force expected in 2027.
Canada and the United Arab Emirates signed the Comprehensive Economic Partnership Agreement (CEPA) on Tuesday, Oct. 27, 2026, to reduce tariffs, cut red tape and improve market access for businesses in both countries. The signing was presided over by Prime Minister Mark Carney and Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan.
The pact is part of Carney's strategy to diversify Canada's trade relations in the face of tariffs imposed by the United States. The prime minister has pledged to double Canada's trade outside the United States over the next decade, after attempts to reach an agreement with Washington broke down.
"Once fully implemented, the CEPA will reduce or eliminate tariffs on more than 99% of current Canadian exports to the UAE. That means new markets for Canadian farmers growing pulses and canola, for manufacturers of industrial machinery and power generation equipment, for our world-class aerospace sector and for other Canadian innovators," the Prime Minister's Office said in a statement.
The agreement will also address non-tariff barriers, create a more predictable environment for trade and investment and expand access to Canadian goods and services, including in the industrial, agricultural, forest, fish and seafood, environmental and engineering sectors. CEPA is expected to enter into force in 2027.
Both countries also signed preliminary agreements on energy, diplomatic and defense cooperation. UAE Foreign Trade Minister Thani Al Zeyoudi said: "We see considerable potential for our private sector, whether through improved market access for our exporters or access to investment opportunities in high-growth sectors such as logistics, communications, advanced technology and manufacturing, all of which will support our pursuit of a resilient, diversified and globally connected economy." Al Zeyoudi signed the agreement with his Canadian counterpart, Maninder Sidhu.
The UAE is the largest market in the Middle East for Canadian exports and a major buyer of motor vehicles, auto parts and machinery. Bilateral trade reached C$3.5 billion last year and has been growing at a rate of 10% annually in recent years, according to government data. Last year, the UAE also committed to investing up to $50 billion in Canada.
The signing is the last step before Canada's Parliament can ratify the agreement, a Canadian government source said.
