The partnership aims to strengthen trade ties between the two countries as they work together to finance the critical mineral industry’s development. Critical minerals, such as lithium, cobalt and nickel are important for specialized manufacturing and defence. Lithium is a key input for Germany and Canada’s electric vehicle industries. In April, China restricted rare earth exports, which disrupted supply chains, including for automobile and semiconductor manufacturers.

• Canada and Germany signed a critical minerals partnership on Tuesday. The German Economy Minister, Katherina Reiche, voiced hopes that German manufacturers would be able to rely on Canadian suppliers and provide access to global markets.
• Germany is keen to reduce reliance on dominant suppliers. Most of its critical mineral imports have come from China. Thus, the plan with Canada can help Germany diversify its supply.
• Announcements about investments in Canadian port infrastructure are expected to support energy and mineral exports. Montreal, Churchill and other ports are in line for upgrades so they can manage liquefied natural gas (LNG) projects, metals and critical materials.
• Broader energy cooperation could include LNG and hydrogen projects. Energy security continues to be a closely followed risk factor in global markets.

Canada is poised to discuss supplying LNG to Germany. Canadian Prime Minister Mark Carney spoke about the potential to ship LNG to Europe, once the infrastructure is in place. The developments highlights Canada’s role as a critical minerals and energy supplier as global trade negotiations evolve.

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