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HomeCanadaWhat will the Canada-U.K. relationship look like under a Labour government?

What will the Canada-U.K. relationship look like under a Labour government?

The election of a new Labour government in the recent British elections may signal change in the United Kingdom, but its immediate impact on relations with Canada is uncertain.

The Canada-U.K. relationship, usually strong, has encountered some challenges this year. The outgoing Conservative government unilaterally paused trade negotiations with Ottawa in January and recently increased pressure on NATO allies, including Canada, to boost defence spending.

In the short term, these tensions may persist. However, shared priorities between Labour and the Liberals could eventually ease relations.

Ann Fitz-Gerald, director of the Balsillie School of International Affairs and a political science professor at Wilfrid Laurier University, noted, “It’s probably safe to assume that we are not going to see much onward movement in resolving those issues until issues surrounding the election are behind us.”

Canada regularly highlights its strong ties with the U.K., especially as a Commonwealth member and significant trading partner. Last year, bilateral trade was valued at $45 billion, making Britain Canada’s fourth-largest single-country trading partner.

The two countries have been negotiating a new trade deal since Britain fully left the European Union, aiming to replace the current Canada-United Kingdom Trade Continuity Agreement that has kept goods flowing. However, British cheese exports faced higher duties after a side agreement expired in late 2023.

Hopes for resolving trade issues were dashed in January when the British government halted talks, citing a lack of progress. Key sticking points included access to Canada’s cheese market and Britain’s ban on meats treated with certain hormones used by Canadian ranchers.

Although the British government expressed openness to restarting talks, negotiations remain stalled. Another temporary deal on country-of-origin rules expired in March, affecting tariffs on British cars imported to Canada.

A spokesperson for Global Affairs Canada stated that negotiators are ready to engage with U.K. counterparts following the election, emphasizing that Canada will only negotiate an agreement that benefits Canadian businesses, farmers, and workers.

Fitz-Gerald suggests that Labour’s progressive, pro-worker economic policies might align with the Liberals, potentially paving the way for an agreement. However, both countries face cost-of-living crises, making it essential to secure a deal that does not overly burden consumers.

“There is hope that the regulatory and tax systems in both countries will ensure the outcome does not excessively burden consumers beyond what they already face,” she said.

The British election comes just before the NATO summit in Washington, marking the alliance’s 75th anniversary. Allies not meeting the two percent GDP defence spending threshold, including Canada, are expected to present detailed plans on reaching that goal.

Canada’s updated defence policy aims for 1.76 percent by 2030, with promises of additional spending. Former British foreign secretary David Cameron suggested raising the threshold to 2.5 percent, pressure that may continue under Labour, which has committed to setting a path to this number.

Labour has also pledged to remain committed to AUKUS, the security partnership between Britain, Australia, and the United States, despite Canada’s exclusion from the pact. Fitz-Gerald sees potential for additional defence partnerships between Canada and the U.K. in areas such as Arctic security, cybersecurity, defence production, and higher education.

“We’re very like-minded and facing similar challenges,” she said. “There is an opportunity to focus on complementary areas, avoiding duplication and competition.”

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