Defence Minister David McGuinty and Prime Minister Mark Carney in Sydney, Australia on Wednesday. Canadian officials are in Australia to strengthen trade ties.Adrian Wyld/The Canadian Press
Scott Stirrett is the founder of Venture for Canada and the author of The Uncertainty Advantage.
No country is more like Canada than Australia.
The two countries are far from identical, but the parallels are hard to miss. Parliamentary democracies with British colonial roots. Significant natural resource sectors. Similar-sized economies. Two middle powers that rarely get to set the rules but often must live with the consequences when rules stop working.
Even the small talk in both countries is about the same stuff: the cost of housing, wages, energy, the weather, the distance between cities and what China and the United States are doing this week.
Critical minerals alliance with Australia an example of middle power strength, Carney says
Canada and Australia are both mining superpowers. Australia alone accounts for 36.4 per cent of the world’s lead reserves, 29.4 per cent of its manganese and 29 per cent of its iron ore. Meanwhile, Canada is a global leader in nickel and potash.
Beyond these similarities, our shared values matter, particularly today when democracy is under siege.
Prime Minister Mark Carney went to Davos, Switzerland, and said middle powers should collaborate through practical coalitions built around shared interests. Mr. Carney’s visit to Australia this week is the perfect moment to prove it can be more than talk.
If Canada is serious about trade diversification, Australia should be the first call.
Imagine Canada and Australia as almost the equivalent of one common market. Together we would have 70 million people and an economy worth more than $5-trillion.
While Canada and Australia are both signatories of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), there is the opportunity to further harmonize our economies and reduce trade barriers.
Working together could involve harmonizing mining standards between countries, co-investing in refining and processing facilities and co-managing strategic reserves of critical minerals.
This could also include further aligning professional licensing standards between the two countries. So, licensed professionals such as physicians, engineers and veterinarians could easily work in both countries.
And what if the two countries practically opened borders so citizens could easily move between the countries without having to go through immigration approval? This isn’t an out-there idea – Australia and New Zealand already basically have this.
Freedom of migration would significantly enhance ties between the two countries, thereby increasing trade.
Let’s be even bolder – separately, the two countries have limited diplomatic clout but together we can have outsized influence.
Canada and Australia could sign a comprehensive diplomatic collaboration agreement. This could involve the two countries further sharing diplomatic services and co-locating embassies. Imagine what a combined diplomatic apparatus would look like?
In regions where Canada has a larger influence, such as Latin America, Australian companies could get access to enhanced consular services to expand their exports. Likewise, Canadian companies could access Australian consular services in the Pacific, where Australia has a bigger presence.
Of course, a lot would need to be sorted out in terms of sharing diplomatic services. There would still be a Canadian diplomatic corps. Dozens of countries lack a Canadian embassy, and in working with Australia, we could increase our diplomatic reach without increasing diplomatic funding.
As part of a comprehensive diplomatic agreement, Canada and Australia could enter an alliance where we establish trilateral trade relationships with other countries. By working together, we could increase the number of free-trade deals we have access to. Our combined economic clout gives us more bargaining power than if we negotiate separately.
Canada and Australia could also align on key diplomatic policy files so that our efforts can be combined. For instance, if the United States meddles in Canadian domestic affairs, Canada and Australia could publish joint diplomatic statements. Likewise, if tariffs were put on Australia by China, Canada and Australia could respond together in putting reciprocal tariffs on China.
Canada has spent years talking about diversification. Australia is one of the rare partners where values, institutions and economic interests line up without forcing it. That is exactly the kind of relationship a middle power should build before the next shock hits.
What I am arguing for is not a new country, it is a new level of practical integration. Two independent democracies that build a shared operating system in trade, mobility, diplomacy and critical minerals, so we have more leverage and less duplication in a world where big powers are less predictable.
It’s time for Canada to look down under.