In Tokyo, Carney signs agreement with Japanese counterpart to expand trade and defence ties
Prime Minister Mark Carney inked a series of agreements with his Japanese counterpart Friday designed to expand and “modernize” the bilateral relationship as he continues his push to develop deeper ties to like-minded countries in the Indo-Pacific — now that the Canada-U.S. relationship is on shaky ground.Carney and Japanese Prime Minister Takaichi Sanae, who won a landslide election victory in February, put pen to paper on what Ottawa is calling a “comprehensive strategic partnership,” designed to spur bilateral co-operation in areas from defence, energy, critical minerals to trade and technology.While the new agreement is effectively a expression of goodwill and a pledge to work together more in the future — there are no dollar figures or extensive details attached to these proposed initiatives — Carney still framed the new bilateral arrangement as something significant. “This new partnership will deepen our economic and security relationship. It harnesses the scale of our ambitions, reflects the depth of our values, and positions Canada and Japan to seize enormous opportunities for both our peoples,” Carney said.The prime minister seems to have impressed Takaichi and the Japanese press when he recited some lines of his remarks in the local language. Carney worked in Tokyo for investment banking firm Goldman Sachs in the 1990s and picked up some proficiency in Japanese, although his delivery was halting and he dropped one of his planned lines. Carney was welcomed to the Kantei, Takaichi’s official residence, a grand modern building in the heart of Tokyo, by a military band playing O Canada and the Japanese national anthem. Takaicihi, who won two-thirds of the seats in Japan’s last election, the largest number ever won in the country’s post-war history, directed Carney through the ceremony while wearing a broad smile.As part of this new partnership, there's a commitment to do more joint military exercises in the region and Japan is considering joining Operation Nanook, Canada’s annual Arctic sovereignty exercise.Together the two countries will also co-develop AI products, aggressively identify investment opportunities and deploy trade delegations to their respective countries sometime this year to stir up more business.Canada has also agreed to support Japanese automakers’ desire to decarbonize their operations in Canada and expand battery supply chains, among other projects.The two countries will collaborate on international emergency response, joint Coast Guard exercises and action against illegal, unreported and unregulated (IUU) fishing in the North Pacific. On fishing, Canada will share data from its world-leading Dark Vessel Detection Program with Japan to intercept such ships.Canada and Japan have also agreed to continue partnering on liquified natural gas (LNG) to deliver more of that fuel to the latter, which has relatively few natural resources of its own.Mitsubishi Corporation, a Japanese firm, already has a minority ownership stake — about 15 per cent — in B.C.’s massive LNG Canada facility. It and other investors are pursuing a second phase but a final decision on the expansion hasn’t been made yet.With seven LNG export projects in various stages of development — including two Carney has already referred to the Major Projects Office for expedited approvals — Canada could become the supplier of choice for Japan, which imports about 87 per cent of its energy needs.Overall, the two leaders have a pledged to “catalyze economic gains for both countries,” the statement on these new arrangements reads, using a word favoured by Carney.Takaichi said the two countries will raise relations to a "higher level," while heralding the strategic partnership as "a new chapter" and "historic milestone" in more than a century of Canada-Japan diplomatic ties.1st leader to visit after Takaichi's landslide winCarney is the first world leader to visit with Takaichi since she won a landslide victory.The visit also coincides with Takaichi’s 65th birthday — and he brought her a cake loaded with Canadian ingredients, including maple syrup, to celebrate.Still, like much of this 10-day tour, the program is mostly all business as Carney drives for new deals from old partners.As U.S.-based automakers pull back from vehicle assembly in Canada amid pressure from President Donald Trump to bolster American manufacturing, Japanese companies like Honda and Toyota have become increasingly relevant players for the future of the sector.Those firms are now responsible for 77 per cent of all light vehicles produced in Canada as of early 2026, marking a significant rise from 44 per cent in 2016, according to the Trillium Network for Advanced Manufacturing, a non-profit think-tank at Western University. While in Japan’s business hub, Carney will make a play for even more investment by those firms in Canada to replace what’s been lost by the departing Americans. Japan was watching China trip closelyOne topic of discussion while Carney’s here could be his recent deal with China to allow some 50,000 Chinese-made EVs into the Canadian market in exchange for tariff relief on some farm and seafood products.On the surface this deal has nothing to do with Japan but this visit could be, in part, about reassuring leaders in Tokyo that the agreement with China is a narrow deal on certain sectors and not about supplanting its relationship with Japan, historically Canada’s strongest East Asian ally, said Vina Nadjibulla, the vice-president of research and strategy at the Asia Pacific Foundation of Canada. “I think Japan was watching the China trip with a little bit more trepidation than our other allies would,” she said. “Japan is a big investor in the Canadian auto sector. Inviting Chinese investments — that will have implications for the Japanese,” she said. China and Japan don’t get along and there’s been some recent tension driven by Japan's pledge to defend Taiwan if attacked and subsequent Chinese economic and military retaliation.“So much of our focus has been, of course, on President Trump and his economic coercion. But Japan is still dealing with a very difficult situation with China. I think, for Canada, we need to show democratic solidarity and we need to have some frank conversations with them about our Indo-Pacific strategy and how it’s evolving,” Nadjibulla said. WATCH | Carney hails ‘landmark’ China trade deal, but not everyone’s happy :Prime Minister Mark Carney is hailing a ‘trademark’ new China trade deal that reduces tariffs on Canadian canola and other products in exchange for slashing tariffs on Chinese EVs. Ontario Premier Doug Ford calls the deal terrible for Ontario’s auto sector.Asked about possible Japanese concerns over Sino-Canadian relations at a pre-departure background briefing with reporters, a senior government social said the Chinese EV deal has “nothing in there that should cause concern to Japan.”Indeed, there is no visible sign of tension between Canada and Japan.Beyond Friday's commitments, the two recently signed a memorandum allowing for intelligence sharing on defence procurement matters to make it easier to buy each other’s military equipment. 'Leaders need to get to know each other'Sen. Peter Boehm, a former top diplomat who now chairs the Red Chamber’s foreign affairs and international trade committee, said this quick trip to Japan is about getting face time with a new G7 leader. The next time they speak by phone or meet in person at a summit there will be some familiarity.“Japan is very important partner for us. It’s one of the larger economies in the world. It’s the third or fourth largest depending on the day,” he said. “The leaders need to get to know each other.” That’s how Nadjibulla sees a trip like this too — it’s about paying respect to a fellow G7 leader and acknowledging how important this partnership really is for Canada. “It’s a relationship that is so stable and so positive that it’s at risk of being neglected and I think we can’t afford to do that,” she said. Amid uncertainty over the future of the Canada-U.S. trading relationship, Carney has made it his top priority to broker deals with other countries to diversify trade and shore up the economy. Other stops on this tour have produced some quantifiable results: about $5 billion worth of commercial deals with India on everything from uranium to pharmaceuticals and beauty products — plus a commitment to sign a free trade deal by year’s end — and a series of agreements with Australia on issues like critical minerals development and defence. Carney was also on hand as IFM Investors, a major Australian pension fund or “super” as they’re called Down Under, also pledged this week in Sydney to invest up to $10 billion in Canada over the next decade.It also signalled it wants to take ownership stakes in the country’s airports and possibly major roads, if they are ever privatized. “We’re looking at very large opportunities,” Kyle Mangini, IFM’s global head of infrastructure, said this week. WATCH | Carney pitches Canada-Australia 'middle power' team-up :Citing global instability, Prime Minister Mark Carney called for closer co-operation between 'middle powers' Canada and Australia on defence, critical minerals and artificial intelligence during his visit to the fellow Commonwealth country.Canadian and Australian pension funds, which are among the most well-capitalized in the world and flush with cash, jointly agreed to co-operate on investment deals and pool money to buy assets as part of an effort to draw the two Commonwealth countries closer together not only in politics but in business.Carney has developed a strong rapport with Australia’s prime minister, Anthony Albanese.Albanese came to Canberra’s airport early Friday morning to see Carney off as he left for Japan, a sign, Canadian officials said, of the warmth between the two men. For Albanese’s birthday earlier this week, Carney brought him Blue Rodeo vinyl records and dog treats for his beloved pet, Toto. There’s a hope that rapport will lead to even more Canada-Australia deals and further integration in the months to come as they jointly grapple with over-reliance on big markets — or as Carney calls them, “hegemons” — like China and the U.S.
