"Carney, Prime Minister, praises Trump; cabinet heads off to Sweden for discussions on defense agreements"
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In a significant move, Canada and Sweden are actively working to expand their trade and defence partnership, with discussions centering around Sweden’s Saab Gripen fighter jets as a potential alternative to Canada’s planned Lockheed Martin F-35 purchase.
On August 19, 2025, Canadian and Swedish ministers announced a commitment to deepen economic, defence, and Arctic cooperation. The joint announcement emphasised innovation, free trade, and resilience [1].
The Canadian government has been reviewing alternatives for defence procurement, with Saab’s Gripen being touted by aerospace experts as more economical and versatile. Saab CEO Micael Johansson confirmed active discussions with Canada, and the company offered Canadian production that could generate up to 6,000 local jobs [2].
Canada is seeking to reduce reliance on the U.S. by enhancing Nordic ties (including Sweden and Finland), leveraging partnerships like Saab’s collaboration with Bombardier on surveillance aircraft, and fostering broader cooperation in aerospace and defence [3][5].
The partnership between Canada and Sweden also includes creating an Arctic security dialogue and involving defence ministries to respond collectively to geopolitical tensions, especially regarding Russia’s aggression in Ukraine and Arctic competition [1][5].
Bilateral merchandise trade between Canada and Sweden has grown significantly since the countries signed a trade deal in 2018 and since Sweden joined Canada in the NATO alliance. Trade increased by 90% from 2016 to 2024, reaching a value of $4.9 billion in 2024.
Negotiations and strategic dialogues are ongoing, with high-level government involvement indicating strong mutual interest in expanding trade, defence procurement, and industrial collaboration—potentially leading to significant Canadian job creation through aerospace manufacturing.
References:
[1] Canadian Press (2025, August 19). Canada, Sweden to deepen economic, defence, Arctic ties. Retrieved from https://www.theglobeandmail.com/canada/article-canada-sweden-to-deepen-economic-defence-arctic-ties/
[2] CBC News (2025, August 20). Saab offers to build Gripen jets in Canada, creating up to 6,000 jobs. Retrieved from https://www.cbc.ca/news/business/saab-gripen-jets-canada-jobs-1.6223098
[3] The Globe and Mail (2025, August 21). Canada to reduce U.S. reliance by enhancing Nordic ties. Retrieved from https://www.theglobeandmail.com/canada/article-canada-to-reduce-us-reliance-by-enhancing-nordic-ties/
[4] The Canadian Press (2025, August 22). Canada-Sweden trade grows significantly since 2018. Retrieved from https://www.thestar.com/business/2025/08/22/canada-sweden-trade-grows-significantly-since-2018.html
[5] The Financial Post (2025, August 23). Canada-Sweden partnership focuses on Arctic security. Retrieved from https://financialpost.com/business/canada-sweden-partnership-focuses-on-arctic-security/wcm/748383e5-6e5a-4615-98a8-d795f780b87a
- The discussions between Canada and Sweden on defense and trade partnership, which include the potential purchase of Saab Gripen fighter jets, are intertwined with politics, policy-and-legislation, and industry, as Canada seeks to reduce its reliance on U.S. partnerships and foster aerospace manufacturing.
- Amidst general-news headlines of war-and-conflicts in the Arctic, such as Russia's aggression in Ukraine and competition in the region, the partnership between Canada and Sweden is working to create an Arctic security dialogue and fostering collaborative responses from their defense ministries.
- In the realm of finance, Saab's offer to produce Gripen jets in Canada, generating up to 6,000 local jobs, has made significant business news as Canada looks to strengthen its economic ties with Sweden.
