Canada and Philippines conclude free-trade talks, target signing next year

Analysis

Prime Minister Mark Carney and Philippine President Ferdinand Marcos Jr. have concluded negotiations for a bilateral free-trade agreement, with the formal signing targeted for next year. The two leaders signed a document finalizing the talks on the sidelines of the Association of Southeast Asian Nations summit in Manila. Carney said the deal would benefit Canadian agriculture, aerospace, forestry, mining and energy sectors by giving companies a bigger competitive advantage. His office projected the agreement could increase exports to the Philippines by up to three times by 2035.

"This is good news for Canadians in the agriculture sector, in the aerospace sector, even in AI," Carney said at a news conference. "In each of these sectors, Canadian supply is meeting Philippine demand. And with our agreement, our producers (and) our companies have a bigger competitive advantage." The prime minister also announced $26 million to strengthen ties on nuclear security, climate-resilient agriculture and food security. His office said the two countries also agreed to launch formal discussions on security and a possible customs agreement.

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A strategic pivot to Southeast Asia

The bilateral deal is part of Canada's broader pursuit of a trade agreement with the 10-nation ASEAN bloc, which includes nearly 700 million people. Trade between Canada and ASEAN countries reached $52.3 billion last year, an increase of one-fifth from the previous year. Carney said an ASEAN deal would give access to smaller markets and ease trade in goods produced across regional borders. The bloc is central to his goal of doubling exports to countries other than the United States by 2035.

Vina Nadjibulla, co-founder of the Centre for Strategic Statecraft, said the ASEAN summit is a chance for Carney to reinforce the importance of Asia to Canadians. "So much of his diplomacy over the last few months has been focused on Europe, understandably so. But we also need to remind everyone that Canada is a Pacific nation, we have an Indo-Pacific strategy, and the region is really critical to Canada's prosperity," she said. Carney signed a trade deal with Indonesia last autumn and a strategic partnership with the Philippines this summer.

Concerns over a narrow focus

While corporations were broadly supportive of the Philippines deal during consultations, civil society groups raised concerns about the country's track record on the environment, labour and human rights. The trade push stems from the Indo-Pacific strategy released four years ago, which Foreign Affairs Minister Anita Anand said is being updated to align with Carney's priorities. Some analysts, however, worry the government's approach is too narrowly focused on trade and traditional security. Queen's University professor Stéphanie Martel said Carney has a narrower policy approach to the region than his predecessor Justin Trudeau, focusing on strategic sectors like trade and military collaboration. "That's not the way that ASEAN countries approach security," Martel said. "These countries all have a very strong tradition, in government and in their military, to look at security in what they call a comprehensive way." She said Southeast Asian leaders link security to climate change, economic growth and the involvement of women in security issues.

Martel said a narrow, trade-focused perspective risks sidelining these broader concerns. "I worry that this is getting sidelined to refocus on the most immediate, strategic sectors like AI and food and energy, and supply chains," she said. Nadjibulla said Canada's challenge is to build partnerships that go beyond trade to include defence industry cooperation, digital trade and education. "We need to do a lot more in not just exporting more to the region or doing trade with the region, but also becoming part of the production and supply chains in the region," she said.

Bilateral merchandise trade between Canada and the Philippines totalled $3.4 billion in 2025. Canada exported mineral ores, meat, cereals, fertilizers and aircraft, while importing cooking oils, leather and rubber products. The two countries first launched formal trade talks in 2015, and Carney and Marcos restarted the negotiations a year ago. Alongside the trade announcement, Canada is extending its dark-vessel detection program, which uses satellites to track fishing boats, until spring 2033.

With files from CFJC Today Kamloops, CBC News and Global News