Free trade between Canada and U.K. ‘99 per cent tariff-free’: Goodale

The Stellantis Windsor Assembly Plant in Windsor, Ontario, Canada, on Tuesday, Feb. 4, 2025. US President Donald Trump's proposed tariffs against Canada and Mexico would threaten production at automakers across North America and send record vehicle prices even higher, with about a quarter of a trillion dollars in trade that would be disrupted. Photographer: Emily Elconin/Bloomberg (Emily Elconin/Bloomberg)

As Canada braces for U.S. President Donald Trump’s looming tariffs, it must start looking into strengthening its trading relationships with other countries, says Canadian diplomat Ralph Goodale.

The former member of parliament and current High Commissioner for Canada in the U.K. believes Canada should grab every trade and marketing opportunity it can identify globally, he told CTV News in an interview Saturday.

“We just have to keep going further and stronger,” Goodale said.

Canada-U.K. trade relationship

Goodale described Canada’s trading relationship with the United Kingdom as “very good,” citing a “solid” free trade agreement negotiated at the end of Brexit and implemented in the spring of 2021.

“The overall economic relationship is worth about $500 billion, about 10 per cent of that is two-way trade,” he said.

The trade agreement provides a two-way access between Canada and U.K. that is “99 per cent tariff free and quota free,” Goodale said.

“It’s already 99 per cent, but we are going to try to work on that last one per cent and see if we can make this trading relationship stronger and better,” he told CTV News.

“U.K. is a reliable partner. Canada is a reliable partner. And we do some excellent business together.”

Canada can realistically expect trade with countries like the U.K. to pick up like it did with the U.S., notes Goodale, even if the American market is big, close, and familiar.

“It’s really the path of least resistance,” he said. “But trade diversification is a universal good.”

Diversification of trade

“We want to diversify our trade far beyond the U.S., so we both have those common objectives in terms of the volume numbers,” Goodale said. “The EU will always be a dominant factor in relation.”

Although the U.K. and U.S. will be important trade partners, Canada needs to start looking for alternatives, he told CTV News.

“We now have 15 trade agreements around the world that engage with 51 different countries and give us market access to two-thirds of the global GDP,” Goodale said.

Domestic trade

In addition to international trade, Goodale believes attention should be given to domestic businesses.

“If you compare companies that export with companies that don’t, the companies that export tend to be more innovative, more competitive,” he said.

Goodale says the companies that export also tend to have better wages and are more profitable.

Now, when the country’s largest trade relationship has become turbulent, Canada should promote trade under all circumstances, he believes.

Tightening U.S.-Canada border security

As for repairing the U.S. trade relationship, Trump has cited concerns like illegal immigration and drugs like fentanyl entering the U.S. from Canada and Mexico.

Goodale says that on a factual basis, the amount of illegal migration or illicit substances that originates in Canada is very small.

“The bigger problem is illegal drugs and guns coming into Canada from U.S.,” he said.

“We can demonstrate clearly that the border problem is not one that originates in Canada.”

The entire situation is a power play and economic coercion that threatens Canadian sovereignty, Goodale said.