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Canada and the Philippines have agreed to conclude negotiations on a bilateral free trade agreement (FTA) by the end of 2026, as the two countries unveiled a broad strategic partnership spanning trade, defence, energy, labour mobility and tourism, underscoring Ottawa’s push to diversify away from excessive dependence on the US market while strengthening its presence in the Indo-Pacific.
Canadian Prime Minister Mark Carney announced the new partnership after holding talks with Philippine President Ferdinand Marcos Jr. in Vancouver during the Philippine leader’s first official visit to Canada in 11 years.
“In a more dangerous and divided world, economic strength must be reinforced by shared security,” Carney said alongside Marcos, signalling that economic cooperation and defence ties would advance in tandem.
The agreement comes at a time when Canada is seeking to reduce its economic reliance on the United States by expanding trade with fast-growing Asian economies, while the Philippines is broadening its security partnerships beyond its traditional ally, the US, amid rising tensions with China in the South China Sea.
FTA expected to boost trade
Carney said negotiators are on track to complete the Canada-Philippines FTA before the end of this year. The Canadian government estimates the agreement could triple bilateral trade by 2035 while opening significant export opportunities for Canadian agricultural and forestry products.
The Philippines, with a population of around 113 million, has emerged as one of Southeast Asia’s fastest-growing economies and is Canada’s sixth-largest merchandise export market within the Association of Southeast Asian Nations (ASEAN).
Bilateral merchandise trade between the two countries reached C$3.4 billion (about $2.4 billion) in 2025.
The bilateral negotiations are proceeding alongside talks for a broader Canada-ASEAN free trade agreement, which Ottawa also hopes to conclude before the end of the year under the Philippines’ chairmanship of ASEAN.
According to the Canadian government, the Canada-ASEAN trade pact could add nearly C$2 billion to Canada’s gross domestic product and create almost 14,000 jobs, particularly across agriculture and manufacturing.
The trade initiatives form part of Carney’s broader economic strategy to double Canadian exports to non-US markets over the next decade.
Defence ties deepen amid Indo-Pacific tensions
Beyond trade, the two countries significantly expanded their defence relationship.
Canada announced that the Status of Visiting Forces Agreement signed with the Philippines will soon enter into force, allowing the armed forces of both countries to conduct joint military exercises and operate more closely together.
The agreement builds upon a Mutual Logistics Support Arrangement and a Statement of Intent on Strengthening Defence Cooperation signed last month during the visit of Philippine Defence Secretary Gilberto Teodoro to Canada.
The Philippines has increasingly sought security partnerships with countries including Canada, Japan and Australia as it faces growing maritime confrontations with China over competing territorial claims in the South China Sea.
For Canada, the strengthened defence cooperation aligns with its Indo-Pacific strategy aimed at expanding its military presence and security partnerships across the region while supporting a free and open Indo-Pacific.
Energy, mining and labour cooperation
The two governments also signed a Joint Declaration of Intent on Energy and Natural Resources Cooperation alongside a new Technical Assistance Partnership.
The agreements aim to strengthen collaboration in energy, mining and critical mineral supply chains, helping both countries build more resilient and sustainable resource networks across the Indo-Pacific.
Recognising the significant contribution of Filipino workers to Canada’s economy, both governments also signed a Joint Declaration of Intent on Labour and Migration.
The framework seeks to improve protections for migrant workers, promote ethical recruitment practices and facilitate safe, fair and transparent labour mobility between the two countries.
Canada is home to more than one million Filipino Canadians, making the Filipino community one of the country’s largest immigrant populations.
Tourism and cultural exchanges
The partnership also includes two new memoranda of understanding covering tourism as well as cultural and artistic cooperation.
The agreements are expected to make travel easier between the two countries while encouraging collaboration across the creative industries and expanding people-to-people exchanges.
Canadian Foreign Minister Anita Anand described the Philippines as one of Canada’s closest partners in the Indo-Pacific, saying the strategic partnership reflects the steady growth in bilateral relations over the past several years.
International Trade Minister Maninder Sidhu said the partnership would create new commercial opportunities for Canadian businesses while strengthening Canada’s engagement with Southeast Asia.
The leaders are expected to meet again later this year at the ASEAN Summit in Manila, where further progress on both the bilateral and Canada-ASEAN trade negotiations could be announced.
