MONTREAL — Canada embraced the European Union’s offer of “associate membership” after a two-day summit at which Brussels and Ottawa gave themselves until next June to work out what their new relationship will look like.

Prime Minister Mark Carney’s endorsement of the proposal by European Commission President Ursula von der Leyen followed weeks of hesitation, a hostile response from U.S. President Donald Trump and pushback from EU heavyweight Germany.

“In the coming months, we will determine the full substance, scale, and scope of this new form of membership,” Carney told a press conference on Friday at the end of the two-day summit at the Port of Montreal. 

“Today, we move towards associate membership for Canada,” Carney said, describing it as “the deepest possible partnership short of accession.”

The two sides have set a June 2027 deadline to determine the terms and boundaries of their intensifying relationship — an alliance that comes with a payment schedule. Carney danced around a question pressing him on how much associate membership will cost the Canadian public.

“We don’t view this as paying, personally,” Carney said, stressing the alliance as a “positive” project.

Von der Leyen and European Council President António Costa, standing either side of Carney, presented the experiment as a necessary survival strategy to thrive in an increasingly dangerous world.

“The concept of an associate member is uncharted territory but we have the ambition, trust and creativity to shape it together,” Von der Leyen told reporters. “To be crystal clear, this is not a partnership against anybody, but for our common strength.”

Canadian government officials who spoke to reporters after the press conference confirmed legislation won’t be necessary to legitimize Canada’s EU associate membership status.

“Our relationship is so special that we want to create something new — to go beyond a simple association, everything short of a full EU membership,” said Costa, pitching a new model for non-European countries to integrate more closely with the bloc. “Our association will be the closest, deepest and most unique of its kind.”

Irritants persist

Despite the upbeat rhetoric, some longstanding trade disputes remained unresolved after the summit.

Carney told reporters the two sides had reached an agreement on carveouts from a landmark EU anti-deforestation law, but Canadian government officials subsequently walked back his assertion.

The issue remains part of ongoing trade discussions, one official said, noting progress in addressing what Canada views as flaws in the legislation. The officials were granted anonymity to discuss sensitive diplomatic and trade negotiations.

Another irritant has been whether Canada would qualify for “Made in Europe” status under the EU’s Industrial Accelerator Act, a landmark measure that would seek to channel public procurement spending in sectors ranging from green energy to automotive toward locally produced goods. 

Von der Leyen said the regulation proposed earlier this year by the Commission foresaw including Canada as a free-trade partner, but added that it was now subject to review by EU lawmakers and governments.

“The Industrial Accelerator Act has been proposed by the Commission to include all countries with whom we have free-trade agreements. So automatically Canada would be in,” she said in response to a question. 

“Of course now the proposal has to go through the co-legislative process. But our proposal is very clear in including Canada.”

Despite months of preparations, the summit itself was chaotic, with agenda details confirmed at short notice and bilateral meetings split between two locations. The informal arrangements were intended to encourage more face time between EU commissioners and Canadian ministers, who are set to see much more of each other.

Canadian ministers have been invited to attend more meetings with their EU counterparts as part of a plan to deepen political alignment. Recent participation by Foreign Affairs Minister Anita Anand and International Trade Minister Maninder Sidhu in informal EU meetings has served as a trial run.

Carney himself is expected in Dublin in two weeks, having accepted Costa’s invitation to join an informal European Council meeting.

For decades, Spain’s high-speed rail network had been a source of national pride, symbolizing the country’s rapid modernization and its rise among Europe’s leading economies.

But Wednesday’s deadly train disaster — following another mass-casualty rail crash in January — is turning that legacy into a political liability and putting the state of the railways at the center of the campaign ahead of the Nov. 29 snap election.

“The deaths of more than 100 people in two train accidents in the span of eight months raise serious questions about the integrity of the railway system,” opposition leader Alberto Núñez Feijóo said Thursday, adding that Spaniards “deserve answers.”

Those answers are hard to find. Experts point to human error, maintenance issues, austerity and EU-level rail safety reform as all having played their part in the deaths of at least 69 people near Toledo on Wednesday.

Spain’s transport ministry says the preliminary investigation points to a chain of failures. After a computer malfunction knocked out the German-made signaling system installed in 1992, railway network officials took control and authorized a train to proceed along a track where another had stopped, causing the deadly collision.

Jaime Tamarit, a former director of a European railway-signaling certification laboratory who helped oversee the development of the pan-European system meant to prevent railway accidents, said the system failure revealed the grave state of Spain’s high-speed rail network.

“The whole point of a train-protection system is to guard against human error,” he said, adding that the failure of such a critical mechanism suggested, “the infrastructure is in a terrible state.” 

Investment in Spain’s railways plunged during the financial crisis and subsequent austerity years. Although spending has since recovered, it remains well below its pre-crisis level in real terms.

Between 2018 and 2022, Spain allocated an average of €1.5 billion a year to high-speed rail —more than France or Germany — but most of that money went toward new infrastructure. Maintenance, renewals and upgrades accounted for about 16% of Spain’s high-speed rail spending, compared with 34% to 39% in France, Germany and Italy, according to European Commission data.

“If you have more train lines, you need more staff, and to spend more on maintenance,” Tamarit said.

The safety expert attributed the apparent lack of investment to political prioritization that values flashy new construction over maintaining existing infrastructure. “Maintenance is vital — but also politically invisible,” he lamented.

Adif, Spain’s railway infrastructure manager, has repeatedly defended the adequacy of its maintenance regime and insists it has always complied with safety requirements. The state-owned company did not immediately respond to a request for comment.

Unanswered questions

Ana Miranda, a European Parliament lawmaker from Galicia’s nationalist BNG party, accused Spanish authorities of failing to learn from past rail disasters, drawing parallels between Wednesday’s crash near Toledo and the 2013 Angrois disaster in Galicia, which killed 80 people and injured 152.

“The Angrois accident is happening again,” she said, arguing that the government of then-Prime Minister Mariano Rajoy had focused on human error while failing to adequately address the technical and systemic issues that may have contributed to the disaster.

“In the Angrois case they singled out the driver, and now they’re trying to do the same with the control workers,” Miranda said. “We need to get to the root of the causes, and that requires investigations.”

The EU Agency for Railways reached a similar conclusion in 2016, when it issued a report finding the investigation into the Angrois disaster had not met the required standards of independence and recommended a new inquiry. The European Commission subsequently launched infringement proceedings over wider shortcomings in Spain’s railway safety oversight.

Miranda said authorities had also failed to conduct a sufficiently rigorous inquiry into January’s Adamuz crash, which killed 46 people. An independent technical investigator assisting the probe has alleged that Adif altered accident reports, while questions have also emerged over documentation relating to inspections of track welds on the stretch where the crash occurred.

Adif denies wrongdoing and says it has cooperated with the judicial investigation.

For Miranda, the repeated controversies point to a failure spanning successive governments. She accused the country’s two dominant parties — the center-right People’s Party, which was in power at the time of the Angrois crash, and Prime Minister Pedro Sánchez’s center-left Socialists, who have governed Spain since 2018 — of maintaining a “pact of silence on high-speed rail.”

“They had enough time to implement rules,” she said. “How easy is it to blame the worker when nothing has been done to change things?”

Europe’s slow transition to safer railways

Wednesday’s crash highlights a wider European challenge: replacing fragmented national signaling systems with modern technology while maintaining aging infrastructure. 

The trains involved in the deadly collision in Toledo were not using ERTMS, the European Union’s standard rail-signaling system, which can automatically brake trains that exceed permitted speeds or fail to obey signals.

Spain’s post-pandemic recovery plan included investments to modernize railway signaling and traffic control, including the deployment of ERTMS. The Madrid–Seville line was also due to be equipped with the system under a separate signaling-renewal project authorized in 2020, but the upgrade remains incomplete.

Investigators have yet to determine whether ERTMS would have made a difference in Wednesday’s crash.

Deployment of the latest railway safety technology across Europe remains far behind schedule. By the end of 2024, European Train Control System technology — the core signaling component of ERTMS — was operational on only about 12,400 kilometers of track, roughly 10% of the EU’s trans-European transport network, according to the European Union Agency for Railways.

National plans aim to expand coverage to 40,000 kilometers by 2030, out of roughly 63,000 kilometers the EU wants equipped across the bloc. But an EU official said they doubted even that target would be met on time.

Politics has been part of the problem, the official said, with countries having “different reasons for not adopting the system” and Brussels allowing national systems to remain in place for years. “It was only in 2024 when we actually said ERTMS is going to be the single European system,” the official added.

The EU aims to have ERTMS installed on 57% of its main rail corridors by 2030 — but that target increasingly seems out of reach. 

Rail lobbies in Brussels say funding for signaling and network upgrades is insufficient. But these concerns have only sharpened after the Irish presidency of the Council of the EU proposed cutting the Connecting Europe Facility by 14% from the Commission’s original proposal in its latest negotiating document for the bloc’s next seven-year budget.

Further safety improvements could be undermined by cuts to EU research programs. Indeed, a draft of the new Horizon Europe structure under the next long-term budget, seen by POLITICO, could cut rail research entirely — even though that research is what underpins the ERTMS blueprints the industry will have to adopt.

The official added that companies won’t expand production without knowing that “there are contracts for next year.”

Despite the obstacles, the European Commission is trying to accelerate the rollout of the safety mechanisms.

Last September, industry and policymakers gathered in Brussels to discuss an “ERTMS Deal” aimed at standardizing technical requirements, speeding up approvals and encouraging deployment through EU funding. 

But the technical blueprint underpinning the plan is still being developed, with an initial batch of results expected by the end of 2027 and some elements requiring further testing and validation. 

That leaves little time before the EU’s 2030 deployment targets. For an industry seeking to expand production, the official said, the uncertainty itself is an obstacle for companies that ultimately need to know “there are contracts for next year.”

Delays in improving rail safety remain a challenge across Europe. The deadly crash on the line between Madrid and Seville is a stark reminder that the stakes of getting those improvements right are measured in human lives.

Former Spanish Employment Minister Fátima Báñez was confirmed Thursday to be among the victims of the deadly train collision outside Toledo, Spain, in which at least 69 people died.

The former minister’s death was announced by CEOE, Spain’s main employers’ association, whose foundation she chaired. “[Báñez’s] leadership, social commitment and strategic vision have left an unerasable mark on this organization and all those who have worked with her,” the CEOE said in a statement.

Within hours of the crash, authorities said the former minister was traveling in one of the carriages most affected by the collision, but were unable to confirm she was among the dead until Thursday.

Báñez served in center-right Prime Minister Mariano Rajoy’s government from 2011 to 2018 and played a central role in Spain’s response to the eurozone crisis. During that period, she developed a warm personal relationship with Ursula von der Leyen, now European Commission president, who was then her counterpart in Germany’s labor ministry.

As employment minister, Báñez oversaw the conservative government’s controversial 2012 labor-market reform, which made it easier for companies to dismiss workers and drew fierce opposition from trade unions. The administration argued the changes would make hiring more flexible and accelerate the country’s economic recovery.

Speaking from the crash site Wednesday, Prime Minister Pedro Sánchez declared three days of national mourning. “All of Spain is mourning,” he said.

“It is unacceptable for a country like Spain to suffer two high-speed rail accidents in the same year,” Sánchez added. “We are going to get to the bottom of this, and if there has been negligence, it will be revealed, and if there have been failures in the system, we will act decisively.”

Transport Minister Óscar Puente said the initial investigation suggested the collision was caused by an official at the national railway control center in Madrid who “inexplicably” instructed one high-speed train to proceed along a track where another had stalled.

Puente insisted Spain has “a safe transport system,” but acknowledged that “human action plays a role” and that, despite extensive safety regulations and protocols, “failures can occur.”

Quebec’s separatist premier says that he will boycott the EU-Canada summit that opens in Montreal on Thursday, warning European leaders that deals struck there without his government’s consent may not be applied in the country’s second-biggest province.

Paul St-Pierre Plamondon confirmed his absence late Wednesday in an open letter to the European delegation, which he posted on X. His announcement followed two days of public sparring with Canadian Prime Minister Mark Carney over Ottawa’s refusal to let him address the summit.

“This dynamic creates uncertainty as to the application of the agreements you could negotiate during the summit,” he wrote in French.

In the letter, St-Pierre Plamondon says Ottawa has “decided to sideline Quebec” from the talks. He says this leaves his government with “neither a chair at the negotiating table nor the opportunity to speak,” even though the summit is on Quebec soil.

Under Canada’s federal system, he argued, the provinces implement international agreements that fall within their powers. Without Quebec’s consent, a deal that runs against its interests “will simply not be implemented,” he wrote. He also accused Ottawa of withholding “critical information” on the negotiations.

He offered to meet European leaders “in the near future, in a more opportune context.” He will send Quebec’s chief diplomat, Pascal Paradis, to the summit in his place.

Carney said Wednesday his office had offered the premier the honor of welcoming the Commission president to Montreal, and a seat at the head table. “I hope he will reconsider,” he said. On Tuesday, the prime minister had accused St-Pierre Plamondon of choosing to “leave an empty chair again.”

The row has soured the upbeat mood around the summit, which Commission President Ursula von der Leyen and European Council President António Costa have billed as a milestone. Leaders will launch an “Alliance for the Future,” a framework for shared prosperity and economic security.

St-Pierre Plamondon’s letter says many of its topics fall under Quebec’s responsibility, including health, education and natural resources.

The premier has also pursued his own contacts with European leaders.

He spoke by phone with French President Emmanuel Macron on Monday, and said the two had agreed on a possible meeting in France in the coming weeks.

At working level, ties have held so far, and officials describe the relationship as constructive.

Hélène Drainville, Quebec’s delegate general in Brussels, told POLITICO last week that Quebec was in talks with the European Investment Bank and the Commission, and that “all the signals are green.”

Carney, Costa and von der Leyen are due to hold a joint press conference on Friday.

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Two high-speed trains collided south of Madrid on Wednesday morning, less than a year after the Adamuz train crash that killed dozens of people and shook Prime Minister Pedro Sánchez’s government.

At least 64 people died and 58 people were injured in the crash, which took place near Urda in Toledo province just before 9 a.m. local time, emergency services in Castilla-La Mancha said on Wednesday afternoon. The toll has now exceeded that of the Adamuz crash, where 46 people died on Jan. 18.

Emergency services said a Renfe train rear-ended a stationary Iryo train, causing two Iryo carriages to fall down an embankment. Both trains were traveling between Madrid and Seville.

Prime Minister Pedro Sánchez said he was “dismayed” by the accident and sent his “solidarity and support” to the victims and their families. He said emergency services were working at the scene to help those affected and ensure their safety.

Opposition leader Alberto Núñez Feijóo of the People’s Party said he was “very worried” about reports of a new rail accident and that the priority now was to help the victims and support their families.

Santiago Abascal, leader of far-right Vox, also offered condolences to the victims’ families but turned his message to the government. “I will not rest until this government, which is a criminal organization, sits in the dock to answer for its crimes,” he said on social media.

The accident led the government, the PP, the PSOE and the left-wing Frente Amplio to cancel their main pre-campaign events ahead of the November 29 general election, with Vox as the exception. Abascal said he would not “use mourning to silence the complaints” in an interview Wednesday morning.

European Commission President Ursula von der Leyen offered her condolences on X, saying she had received the “devastating news” from Toledo and that “Europe mourns with you.”

The Adamuz accident drew sharp criticism of Sánchez’s government, with the PP accusing it of failing on rail safety and demanding that Transport Minister Óscar Puente answer for it. Sánchez, who stood by Puente, was later grilled in the Spanish parliament over the government’s response.

This is a developing story.

BRUSSELS — Quebec’s new separatist government is treating this week’s EU-Canada summit in Montreal as the start of a wider diplomatic push to get the province in the room whenever Ottawa and Brussels strike deals that concern its powers.

The separatist Parti Québécois returned to power this month at the head of a minority government in the province, promising to assert greater control over Quebec’s affairs and eventually hold another referendum on independence. 

“Quebec has to be at the table, and Canada understands that very well,” Hélène Drainville, the province’s delegate general to the Benelux and the EU institutions, said in an interview in Brussels.

Prime Minister Mark Carney hosts Commission President Ursula von der Leyen and European Council President António Costa on Thursday and Friday for a summit the two sides have billed as a step change in relations, driven by Donald Trump’s tariffs and a shared need for new partners. Von der Leyen has even proposed to make Canada an “associate member” of the EU — an offer that goes too far even for some of the bloc’s member countries. 

Early drafts of a joint summit declaration include a digital trade deal, a pact to let the European Investment Bank finance Canadian critical minerals projects, and a consignment of Canadian water bombers for Europe’s emergency services.

While Canada is responsible for negotiating the text, much of it lands in areas where its 10 provinces have extensive powers, such as over natural resources, education and health. Quebec is the second-largest province by population after Ontario and has a territory more than twice the size of France — with which three-quarters of its people share French as their mother tongue.

“Canada negotiates the umbrella agreement, and where we come in is when what’s negotiated touches our areas of jurisdiction,” said Drainville, who has been in post for a year. Natural resources are a provincial matter, she added, noting that Quebec has deposits of 22 of the 34 minerals on the EU’s critical list.

The province is already talking to the European Investment Bank and DG GROW, the European Commission’s industry department, about the bank’s entry into Canada, she noted. 

Asked whether Quebec’s interests line up with those of Ottawa, Drainville said federal and provincial officials have already set up joint working groups to implement the summit’s outcomes. “Right now, all the signals are green,” she said.

New arrival

The cooperation comes at an unusual moment. Quebec’s new premier, Paul St-Pierre Plamondon, won power on Oct. 5 while promising a third referendum on sovereignty, though not as long as Trump is in the White House. His cabinet includes the new position of minister for “accession to independence.”

However, support for independence in the province is the lowest it has been for three decades, around 29% in a poll from earlier this year — hardly a popular mandate for the project.

The Parti Québécois has nevertheless pledged to double Quebec’s 34 offices abroad. A party blueprint published last year would raise the number of countries with a Quebec office from 19 to 38 and, if the referendum delivers a “yes” to sovereignty, would turn those delegations into embassies and consulates.

“Quebec is going to start to exist and shine everywhere in the world,” St-Pierre Plamondon said last year, describing the representative network as a prerequisite for independence.

Drainville said the new government, which has been in office for three weeks, has not yet set its line on Europe. 

“Our political leaders haven’t taken a position yet, which is normal,” she said. “But if they decide to double [the network], it’s because they believe in this partnership.” As for the associate-member label, she declined to engage: “We’re not really into semantics. That’s Canada.”

What Quebec does want from the EU, she said, is “win-win partnerships,” noting that the province and Ottawa complement each other and are stronger together when it comes to relations with Europe.

It hasn’t always been so amicable. 

Quebec’s diplomatic ambitions date back to the 1960s, when the provincial government asserted the right to pursue international relations in areas under its constitutional jurisdiction.

Its international aspirations became politically contentious when French President Charles de Gaulle publicly embraced Quebec’s independence movement in 1967 — ending a speech in Montreal by proclaiming: Vive le Québec libre! (“Long live free Quebec!”) 

The Brussels office opened in 1972, and the province now counts 10 posts in Europe, which Drainville called the most of any Canadian province.

Quebec never consented to the constitutional changes Canada enacted in 1982, and its 1995 independence referendum failed by the narrowest of margins (49.4% to 50.6%). A decade ago, Quebec lobbied Europe for a seat at the table in negotiations on the CETA EU-Canada trade deal.

German politicians have sharply criticized Audi CEO Gernot Döllner’s appearance alongside U.S. President Donald Trump at a campaign rally on Saturday.

“Actively campaigning for an autocrat who is waging a trade war against Germany marks a new low for the VW Group,” said Isabel Cademartori, a Social Democratic Party lawmaker and the party’s transport policy spokesperson.

“This is a disgrace,” she added, “especially considering the history of the VW Group.” Audi is a subsidiary of Volkswagen, which was founded in 1937 by the Nazi Party’s German Labor Front. Cademartori went on to accuse Audi of “validating Trump’s strategy” of “using a trade war to shift jobs from Europe to the United States.”

At the rally in the U.S. state of Georgia, Trump announced Audi plans to invest around $4 billion to build a new factory and begin producing cars in the U.S. for the first time. Döllner joined Trump on stage and thanked him for his support.

The announcement comes as Volkswagen faces a deep crisis amid a major restructuring in Germany, with factory closures and mass layoffs expected.

MEP Dennis Radtke from the center-right Christian Democratic Union party also lambasted Döllner’s appearance at the Republican campaign rally. “Donald Trump’s policies are massively damaging German industry, including the automotive industry,” he told German media outlet Handelsblatt.

“The fact that German companies invest abroad is initially a completely normal and understandable process. However, to turn this into an election campaign staging for Donald Trump is disturbing and pathetic,” he added.

German union leaders joined in the condemnation of Döllner. Christiane Benner, first chair of IG Metall, Germany’s biggest industrial trade union, said Monday: “The way in which Gernot Döllner presented himself and Audi in the USA is highly embarrassing, politically unacceptable, and unworthy of the company — and, above all, unworthy of the people who work at Audi.

“Döllner is flagrantly violating the company’s own internal policies, which explicitly mandate political neutrality in the lead-up to elections,” she added.

In a statement released Sunday, Audi said the “U.S. offers considerable growth potential for Audi. Local production is a central component of a comprehensive growth strategy.” The company added that “the planned investment is a long-term commitment to the United States.”

Earlier this year, Volkswagen CEO Oliver Blume blamed the firm’s worst financial results in a decade partially on tariffs imposed by the Trump administration.

Mark Carney’s pursuit of a global alliance of middle powers has a Europe problem.

Canada’s prime minister wants to help build a new world order that can counterbalance the power of the United States and China. But his vision depends on a new relationship with a Europe that doesn’t see itself as a middle power at all. 

European Commission President Ursula von der Leyen has a different vision: a Brussels-centered bloc that extends the EU’s economic and geopolitical influence, starting with Canada. The idea, according to senior European lawmaker Siegfried Mureșan, is to create an opportunity for the EU to become the “global center of gravity for liberal democracies.” 

The competing visions will be tested this week when Carney and von der Leyen meet in Montreal for a summit intended to chart a new course for transatlantic relations. Both want to demonstrate they can prosper in a world upended by U.S. President Donald Trump. But they have different ideas about their curious new alliance — and face political resistance that could limit how far the partnership can go. 

Von der Leyen’s offer of “associate membership” in the EU surprised officials on both sides of the Atlantic. Four diplomats told POLITICO they were not consulted before she floated the idea in the State of the Union. The officials added that they don’t understand the label, which has yet to be defined. Germany has since led pushback on the plan.

“We’ve definitely put the cart before the horse,” one of the diplomats said. “We’re announcing something and then figuring out how to flesh it out.”

Trump called the membership idea “laughable,” but also threatened “very serious tariffs” should it come to be — a reminder that leaders in pursuit of Washington workarounds must avoid provoking the White House. 

The leaders are under pressure to leave Montreal with more than a liberal democratic photo-op. For starters, they need to decide what “associate membership” means — and disarm resistance in the EU capitals blindsided by von der Leyen’s plan.

Canada’s Ambassador to the EU Jonathan Wilkinson told POLITICO last month that people got too hung up on a label that was revealed prematurely. Carney called the Canada-EU relationship an “alliance for the future” when he addressed European lawmakers in Strasbourg.

Wilkinson said the Canada-EU project will show other democratic nations how to deepen partnerships. “It ties into very much what [Carney] talked about at Davos — and after Davos.”

Carney, von der Leyen and European Council President António Costa have two days to chart what’s next while American foreign policy continues to stress test geopolitical relationships in midterm campaigns that will shape Trump’s last two years in office.

The economic divide 

Ottawa considers the EU an obvious partner in its push to diversify trade away from the U.S. There’s already a free-trade agreement that both sides view as being underutilized. 

Leaders gathering in Montreal this week will celebrate the 10th anniversary of the Canadian-EU trade agreement, nicknamed CETA. But nine EU member countries have yet to ratify the deal, underscoring the challenge of turning rhetoric into reality. 

“We have shared challenges and many more shared opportunities,” Canadian International Trade Minister Maninder Sidhu told reporters last week in Dublin, where he was invited to participate in an informal meeting of EU trade ministers, a preview of what a more integrated Canada could look like. “Canada wants to be Europe’s most reliable partner.”

Sidhu said CETA utilization rates in EU member countries range from 60% to 80%, making a point about room for improvement and perennial challenges. “We know there’s room to grow.”

Von der Leyen’s associate membership plan “has been coldly received by member states,” a senior EU official said. “It [the summit] is more about what we do, how we can use the real potential of the CETA agreement.” CETA has been provisionally in force since 2017.

Trade talks between Canada and the bloc read like a lengthy transatlantic grievance list.

At a meeting between Brussels and Ottawa last October, the EU complained about Canadian taxes it says disproportionately hit European carmakers, opaque cheese-import quotas, cumbersome rules on cosmetics and what it considers discriminatory provincial taxes and markups on European wines and spirits.

Canada, meanwhile, warned that the EU’s deforestation rules could burden its exporters, questioned the impact of Brussels’ carbon border tax and pressed for greater recognition of Canadian standards in areas including AI.

The senior EU official described the relationship as constrained by “irritants and unfulfilled promises” that must be resolved if the two sides are to make progress.

There are hurdles ahead. Even as Canada and the EU imagine a deeper economic and security partnership, both are pursuing industrial policies that could shut the other’s companies out of lucrative public contracts — death by compounded trade barriers.

Brussels has concerns about Ottawa’s “Buy Canadian” initiatives and their compatibility with the EU-Canada free trade agreement. “Some member states didn’t like the ‘Buy Canada’ thing from Carney,” the official added.

Canada is likewise uncertain whether its companies will qualify for the EU’s proposed “Made in Europe” preferences foreseen in a major industry bill that would seek to channel public procurement spending to European companies. The EU is divided over whether to extend those preferences to trusted trading partners, a topic that is expected to come up in Montreal.

Canadian business leaders recognize the domestic appeal of “Buy Canadian” in the face of Trump’s threats, but warn there will need to be concessions.

“It’s something that will have to be resolved in order to move the relationship deeper, particularly with respect to industrial cooperation or collaboration,” Mark Camilleri, president of the Canada EU Trade and Investment Association, told POLITICO.

Camilleri likened the 10-year-old CETA deal to a garden overgrown with weeds. “It pains me to see market access being eroded through Canadian and European preferences,” he said.

Pressure is on

European and Canadian leaders are under pressure to deliver wins this week that demonstrate that “non-hegemons” — a descriptor Carney used in his Davos speech — can survive and thrive in an age of great-power rivalry.

Canadians currently support closer ties with Europe. But the EU faces political headwinds of its own, from fraught budget negotiations within the bloc to right-wing populist movements that are picking up momentum in some of its biggest economies.

One likely deliverable is a new digital trade agreement. Talks launched in March and were still underway last week. But the agreement lacks substantive text on artificial intelligence, leaving the two sides to find other places to cooperate, potentially through the EU’s proposed Cloud and AI Development Act. That proposal seeks to reduce reliance on U.S. tech giants, raising the risk of a new row with Washington. 

The European Commission is also pushing for Canada to join Erasmus+, the bloc’s student exchange program, according to one EU official. Carney has already publicly expressed interest. 

But Brussels has bigger ambitions for the partnership. The EU is pressing Canada to increase its funding for Ukraine, a test of Canada’s willingness to take on more of the security burden. 

For von der Leyen, securing that commitment would be a win. So would leaving the summit with a pledge from Carney to explore her offer of an “associate membership” — or whatever they end up calling it.

Zi-Ann Lum reported from Toronto, Sebastian Starcevic from Brussels and Camille Gijs from Dublin.

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DUBLIN — EU and Chinese officials are already discussing the next sectors for trade talks as Brussels prepares to review implementation of their latest understanding in January, EU trade chief Maroš Šefčovič told POLITICO on Friday.

“In January we can assess how it worked and if it delivered all parts of our agreement,” Šefčovič said, referring to an Oct. 9 pact by which China will voluntarily reduce exports of hybrid vehicles to the EU by almost half to 350,000 units in 2027.

That deal also lowers tariffs on European goods such as auto parts and footwear, and smooths exports of rare earth elements to the EU. 

After a scheduled January videoconference with his counterpart Wang Wentao, Šefčovič said he hopes the two can deliver results in March 2027 at their next round of in-person talks in Brussels. 

“I would like to see that we both have an understanding of what sectors we are going to focus on next,” he said.

The intense engagement with China comes as the bloc seeks to rebalance mutual economic ties, which EU officials say have been distorted by Chinese subsidies, market barriers and a surge in imports. Šefčovič stressed the urgency of the task, given that the EU’s trade deficit with China “reached almost €197 billion in the first half of this year. At this rate, we could break the 2022 record” of €397.3 billion.

“A part of our team is working on implementing all what we agreed, and [another] part of the team is talking to our Chinese counterparts on what should be the next sectors, next areas on what we want to focus the work on. Hopefully with another [Trade and Investment Consultation] in Brussels we can actually deliver the results,” he added. 

“The primary objective for us … is to rebalance the trade.”

At a press conference on Friday, the trade chief said the European Commission was looking to shield more sectors from Chinese overcapacity, with plastics the leading candidate for safeguard measures — a mix of quotas and tariffs.

“We are currently analyzing what would be the best candidates and sectors to be addressed” through safeguard measures, he said. “Currently, what I think is the closest, is the plastic sector.”

Brussels is also juggling requests from the EU’s 27 member countries, which all seek to protect the industries that are key to their economies.

Commission President Ursula von der Leyen told EU leaders last week that Brussels wants to shield the chemical and machinery sectors next, POLITICO reported.

Šefčovič added that the European Commission was looking at proposing new trade tools to nudge EU companies to diversify their suppliers, expected in early December.

“We would respect what we have heard from every single business: Keep it simple, no additional reporting,” he said. 

The EU executive is also looking to incorporate a proposal by France and Germany for a new tool that would allow Brussels within days to restrict — or even close — access to Europe for countries that severely distort the bloc’s single market. 

“It’s better to present a new instrument,” Šefčovič told POLITICO. “We could initiate it very quickly and … act very quickly.”

ROME — Roadblocks by truckers in southern Italy are exposing the limits of Prime Minister Giorgia Meloni’s hardline approach toward protests, as she concedes she will have to take a carrot-and-stick approach to demonstrators struggling with soaring fuel costs.

The demonstrations across the south are fast spiraling into a full-blown economic crisis. Truck drivers and farmers protesting soaring diesel bills have blocked highways, ports and distribution centers this week, leaving supermarket shelves empty and petrol pumps dry. Airports in the south are also suffering from fuel shortages.

After a cabinet meeting on Thursday, the right-wing Meloni vowed to use a security decree to clear the roadblocks, but also pledged to give financial relief to farmers and fishermen crippled by the price of diesel.

Regarding the decree, she said her government would not be “blackmailed by those who use violence as an instrument of pressure.” But she cushioned that blow by acknowledging that financial relief measures were needed to offer “immediate responses, especially to workers, to people who are in difficulty, to families.”

With elections expected in spring next year, the truckers’ protests threaten to shift the political debate from immigration and crime to whether Italians can afford to keep their businesses running. 

Gaetano Amato, a lawmaker from Naples for the populist left 5Star Movement, accused the government of offering security measures instead of answers to the economic grievances driving the protests.

“The government has done nothing and is continuing to do nothing, because it is basing everything on security decrees,” he told POLITICO. 

Stefano Orlacchio, president of the opposition center-left Democratic Party’s youth wing in the southern region of Campania, also slammed the government’s response as “an anti-southern attitude.”

“The protests in the south aren’t being taken into consideration at all,” he told POLITICO.

Diesel squeeze

At the heart of the revolt is a squeeze that truckers say they can no longer absorb. Diesel prices in Italy have risen by about a third since the U.S. and Israeli strikes on Iran began, and the cost of a long haul journey like Naples to Milan has climbed with them. 

Pasquale, a truck driver with a Campania-based company, who asked POLITICO to withhold his surname for fear of retaliation, said a trip’s profit had now shrunk sharply once fuel, tolls and wages were covered, and that the extra cost was working its way down the supply chain to supermarket shelves. 

Far-right Transport Minister Matteo Salvini of the League party, who posed in a truck cab a few months ago, should “come spend a week with me and we’ll see how comfortable it is,” Pasquale quipped.

While a cap on fuel prices exists on paper, he added petrol stations had ignored it “in these days of chaos.”

Beyond fuel prices, Pasquale zeroed in on EU environmental rules that Italian businesses struggle to comply with, even as cheaper foreign produce continues to reach supermarket shelves. “How can you face something like that?” he asked.

The Brussels-based International Road Transport Union has also appealed directly to European Commission President Ursula von der Leyen for help. 

In a letter sent on Thursday and seen by POLITICO, the group and its national member associations said they did not support the blockades but warned that soaring diesel prices were pushing operators to the brink, calling for extended EU state aid and tougher rules on late payments from customers.

The blockades hit hundreds of supermarkets and dozens of distribution centers, according to retailers’ association Federdistribuzione. Fresh fruit, meat and fish ran out within days, followed by other food products, leaving some shops completely empty.

Carlo Alberto Buttarelli, the association’s president, put the damage at “tens of millions of euros,” with fresh food spoiling in trucks and warehouses. Supplies were beginning to resume in Sicily and Calabria on Thursday, but disruption remained in Campania. 

No room to maneuver

Meloni has limited resources to offer relief. Italy remains subject to EU deficit proceedings, constraining Rome’s room for additional spending, while the international instability driving fuel prices higher lies largely beyond her control.

Amato dismissed the announced support from the cabinet meeting on Thursday as money that had already been promised.

While the government’s reaction to last weekend’s northern protests, which were hijacked by masked gangs that looted shops and set fires, was to link the unrest to immigration and deploy troops, the southern unrest is harder for Meloni to handle because it demands concrete economic relief, said Marco Valbruzzi, a researcher at the University of Naples Federico II.

Frustrated voters could turn to the 5Star Movement, which has previously channeled economic discontent in the south, or abstain from voting altogether. 

The protests could also weaken the appeal of early elections expected in April or May next year. A winter of sustained protests would give Meloni a reason to wait until autumn 2027, hoping for an ease in international instability and improved fiscal flexibility. 

If economic grievances dominate the campaign, “she is playing an electoral game on a field that she cannot control,” Valbruzzi said.

BRUSSELS — Center-right lawmakers in the European Parliament are intensifying efforts to weaken two EU climate laws, a campaign that could undermine the bloc’s push to cut planet-warming emissions.

The European People’s Party, the largest group in Parliament, will this week push for a three-year delay to rules on emissions of the climate pollutant methane, a change the fossil fuel sector and the U.S. government have lobbied hard for.

A growing number of EPP lawmakers now also want to delay — or scrap altogether — a new carbon price on transport and heating, known as ETS2, according to a document obtained by POLITICO. That puts them in line with several EU member countries, including Italy and Poland, which pushed for a delay to the new carbon price at a meeting of EU leaders in Brussels last week.

Both policies are central pillars in the EU’s effort to reduce its planet-warming emissions. A successful repeal of ETS2 in particular would be a blow to EU climate goals, as it covers around 40% of the bloc’s greenhouse gas emissions.

But it would also be a major victory for conservative and pro-business lawmakers and national governments that have been campaigning for less stringent EU climate laws in the name of industrial competitiveness.

Ax the tax

The EU Emissions Trading System, launched in 2005, requires power plants and factories in sectors like steel, chemicals and cement to acquire carbon allowances for every ton of carbon they emit. The total number of allowances is reduced each year, eventually reaching zero.

ETS2 applies the same idea to suppliers of fuel for transport and heating from 2028.

The cap-and-trade scheme will be a powerful tool for reducing emissions from these highly polluting activities. But many policymakers worry it will raise the cost of gasoline, diesel and natural gas and add to voters’ cost-of-living pressures.

Nine national delegations of the EPP — the Polish, Spanish, Italian, French, Romanian, Croatian, Slovenian, Slovak and Estonian — are now calling for ETS2 to be repealed, according to draft amendments obtained by POLITICO. “ETS2 should be deleted,” the amendment, sponsored by Polish EPP lawmaker Adam Jarubas, argues.

Another amendment in the same draft, backed by 10 national delegations, takes a softer approach and asks for ETS2 to be “postponed until 2031.”

EU legislators are already reviewing a proposed reform of the EU’s original Emissions Trading System, which makes amending ETS2 — which is contained in the same legislation as the first ETS — much simpler.

No majority in Parliament or among member countries currently supports delaying or repealing ETS2, but a string of elections next year raises the likelihood that more right-wing governments will be in power before ETS2 comes into force, adding momentum to the push to scrap or delay it.

Methane delay

Last week, the European Commission, the EU’s executive arm, proposed a year-long delay to rules that will require oil and gas importers to monitor, report, and eventually reduce emissions of the potent greenhouse gas.

The delay — which affects monitoring requirements and later obligations on methane intensity — followed months of lobbying from industry and member countries, which claimed the Commission provided insufficient clarity on how to comply. The U.S. government also pushed to delay the rules, which are currently due to come into force on Jan. 1, 2027.

But the proposed delay requires support from both governments and lawmakers, some of whom want to go well beyond the Commission’s revised timeline.

On Tuesday, European lawmakers voted to fast-track parliamentary discussions around the Commission’s proposed delay, laying the groundwork for a fresh vote Thursday. At that vote, the EPP is expected to campaign for a three-year delay of the rules, as well as possible further adjustments, according to one lawmaker familiar with the matter.

Dimitris Tsiodras, a European lawmaker, echoed industry concerns that compliance risks could deter cargoes from Europe if left unaddressed. “We cannot afford to put our energy supplies at further risk,” he told lawmakers.

Right-wingers against the rules will still face opposition from left-leaning lawmakers. Jutta Paulus, a German Greens lawmaker who steered the parliament’s position on the legislation in 2024, announced on Tuesday that her party would table an amendment to reject the delay altogether.

However, the EPP could reach an outright majority if it joined with right-wing and far-right groups.

The party is already exploring a deal with those groups if the Socialists and Democrats — the Parliament’s second-largest group — don’t cooperate with its push for a longer postponement, according to two people familiar with the matter. S&D lawmakers opposed extending the delay earlier this month, but a group spokesperson said the party has yet to adopt a formal position in negotiations.

A parliamentary push for a three-year delay could also invigorate member countries’ efforts to delay the rules further.

Member countries are currently divided, though many, including heavyweight France, support the one-year delay proposed by Brussels, according to two diplomats briefed on the matter.

Poland, Slovakia and Czechia, meanwhile, would prefer a three-year delay, but their luck in campaigning for an extension may depend on where Germany lands, the people said. Berlin is currently split between its socialist-controlled environment ministry and its center-right-controlled energy ministry, leaving countries uncertain whether they can formulate a joint position tomorrow, they added.

Italy is also trying to decide whether to opt for one year or more, two diplomats familiar with the matter said.

BRUSSELS — The European Union is beefing up its presence in the Arctic to catch up with neighboring powers carving new trade lanes and drilling for resources under the melting ice.

On Tuesday, the EU unveiled a new plan called Northern Neighborhood. It’s meant to prepare for rising military and commercial activity in the north driven by climate change, and calls for new transport, research and security infrastructure in the region.

“The Arctic is one place where the tectonic plates of geopolitics are colliding. And it’s not someone else’s frontier. It’s part of the European Union,” Commission President Ursula von der Leyen declared as she unveiled the strategy.

She pointed to Russia’s expanding military footprint and the race for emerging shipping routes and critical resources as forces reshaping Europe’s security and economic future.

Climate change is dramatically affecting the Arctic. Planet-warming emissions are making the ice melt faster, disrupting the region’s fragile ecosystems. But where the ice is disappearing, countries like China, Russia and even Canada see an opportunity.

The EU is now scrambling to update its existing policies on the Arctic — once largely focused on environmental protection — to give more importance to security, shipping and extracting resources.

The strategy calls for a rebranding of the EU’s existing partnerships with Norway, Iceland, Canada and the U.K., backed by regular summits to set joint priorities and launch projects.

Here are five things Brussels wants to change about its Arctic policy.

1. Defense and security 

The strategy warns that Russia is rebuilding its military presence in the Arctic and that China has growing strategic ambitions in the region.

The EU plans to set up a pilot research project using satellite and maritime observation in 2027 and share ship-tracking data to help identify Russian shadow fleet vessels.

In the longer term, it wants EU countries to lead on a maritime security hub to pool intelligence on threats ranging from undersea cable sabotage to illegal fishing. It also calls for setting up an Arctic Cable Hub alongside NATO to monitor and protect subsea cables in the North Atlantic and the Arctic. The strategy lacks any information on funding for these projects, however.

Finnish MEP Mika Aaltola of the European People’s Party said the new focus on the Arctic is long overdue.

“Europe hasn’t been thinking about [the Arctic] enough,” Aaltola said. “Because of the ice melting and climate change, it’s becoming kind of the next great game. And if that happens, then what are the European positions when it comes to Russia, China and also the United States?”

2. Access to energy resources

The new policy sticks with EU promises not to drill for fossil fuels in the Arctic.

“The EU remains committed to ensuring that oil, coal and gas stay in the ground, including in Arctic regions,” it reads. Instead, Brussels promises to develop renewable energy projects in the region but drops an old commitment to convince the rest of the world to follow its lead. 

“It is good that the Commission maintains its opposition to oil and gas drilling in the Arctic,” said Delara Burkhardt, a Socialist MEP, but not pressing for a global ban “weakens the EU’s ability to push for stronger international protection and leaves the door open for other countries to exploit one of the world’s most fragile ecosystems.”

The EU’s former Arctic policy — drafted in 2021 — committed the bloc to pursuing an international moratorium on Arctic oil and gas extraction. 

Norway — which supplies a lot of energy to the EU — has made it clear it would still drill in the Arctic regardless of the bloc’s position.

3. Critical raw materials 

The EU is under pressure to secure new supplies of critical raw materials to reduce its dependency on China.

The new strategy says it will continue working with Canada, Greenland, Norway and the United States to develop critical raw materials projects in the region, but insists it will do so while following the “highest social, environmental and governance standards,” and work to the “benefit of local communities in respect of Indigenous Peoples’ rights.” 

Brussels has already labeled several critical raw materials projects, including the Sokli project in Finland and the Per Geijer rare earth deposit in northern Sweden, as “strategic” under EU law, which means they could benefit from faster permitting procedures.  

But some of these projects face serious local resistance from local and indigenous communities, who say the mining plans threaten reindeer herding and protected ecological sites. 

4. New trade routes

Melting ice is opening up new shipping routes in the far north, and the EU is worried that it could be sidelined from the region. But the strategy offers little on that front; its only action is a study on new shipping lanes.

The number of vessels operating in the area covered by the Polar Code — international regulations covering shipping in the Arctic and Antarctic — rose by 40% between 2013 and 2025, while the total distance sailed nearly doubled, said Michael Kingston, a special adviser on polar issues to the Arctic Council on marine protection.

Recent transits by Chinese and South Korean container ships using the Northern Sea Route running along Russia’s Arctic coast show the appeal of a route that is about 20 days faster than conventional routes, he added. 

“Russia builds the infrastructure, China facilitates and funds some of it,” Aaltola said, calling it part of a “grand bargain” between the two.

He complained that the EU is left on the sidelines. “When it comes to the Arctic, there is a vacuum of interest, and there’s also a vacuum of resources and institutions participating.” 

The route is still mostly seasonal for Russian oil and gas tankers, said Ksenia Vakhrusheva, project manager and Arctic project adviser at the environmental group Bellona. Ice, unpredictable weather, increased insurance costs and Moscow’s control over the route make it unlikely to become a mainstream commercial corridor anytime soon, she added.  

Europe also has leverage as the final customer for Chinese shipments, Vakhrusheva said.

“If the EU sends a strong message to China that they do not want goods shipped via NSR, China won’t use this route for transit,” she said. “For NSR to become a valid transit route you need two sides,” she said, “a seller on one side and a buyer on the other.” 

5. Environmental protection 

The strategy is light on measures to shield the Arctic from the impact of global warming. However, it does warn that increased shipping in an “inherently harsh and poorly charted environment” raises the risk of “catastrophic accidents, severe marine pollution” and hybrid interference.  

“Increased shipping in the Arctic both exploits this vulnerability and exacerbates it,” said Dave Walsh, an adviser at the Clean Arctic Alliance NGO, citing carbon emissions, wastewater discharge and noise as some of the impacts of more traffic.

Safety and the environment have not been a priority for Moscow, said Vakhrusheva, and a shortage of high ice-class ships combined with the need to sell oil and gas “to whoever is ready to buy it” raises the risks. 

Protections such as a ban on heavy fuel oil are still negotiated at the International Maritime Organization, where the EU is a key player, she said, adding that such measures will push up the cost of Arctic shipping. 

The strategy says Brussels will push at the IMO to turn measures to limit black carbon — soot emitted by ships that falls on snow and ice and accelerates melting — from voluntary guidelines into binding rules.

It also calls for expanding the definition of Arctic waters to everything north of 60 degrees latitude, replacing the current boundary, which excludes much of the waters around Iceland and Norway from special Arctic shipping rules.

It also promises to keep pressing for compliance with the Polar Code through tools such as an IMO regulation that involves national maritime authorities inspecting foreign-flagged ships in Arctic ports to verify compliance with international safety, environmental and crew-qualification standards. 

The document includes non-binding commitments on biodiversity loss and plans to boost ocean and Arctic research programs. It also promises to launch an “initiative to promote local public and private investment in the Arctic around blue economy sectors.” 

Jakob Weizman contributed reporting.

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