Canada and South Korea have taken new steps to strengthen trade ties that are expected to boost several industrial sectors in Canada, including automotive and critical minerals.
This happens in the middle of global trade war and US tariffswhich have impacted Canada’s economic growth and labor market, forcing the federal government to seek other trading partners and work to eliminate interprovincial trade barriers reduce dependence on the United States
On Wednesday, Canada’s Minister of Industry Melanie Joly met in Ottawa with his counterparts from the Republic of Korea and signed a memorandum of understanding (MOU) between the two countries.
Details of the agreement were outlined in a press release, which includes the creation of the Canada-Korea Industrial Cooperation Committee to work together on what it calls “future mobility.”
Areas the committee will focus on, according to the release, include creating a footprint for Korean auto production in Canada, with electric vehicle manufacturing opportunities among the investments, although no specific amounts were mentioned.
Artificial intelligence was also one of the “strategic sectors” discussed as part of the agreement, but no further details were provided.
In addition to the auto manufacturing sector, the release said the agreement means increased cooperation with South Korea on Canada’s battery supply chain. This means battery production, materials processing and refinement, and critical mineral processing and recycling.
Receive national news daily
Get the day’s top news, politics, business and current affairs headlines delivered to your inbox once a day.
Canada could also increase some exports to South Korea under the deal, according to Tim Hodgson, Canada’s Minister of Energy and Natural Resources, who was quoted in the release as saying the MOU means “we are diversifying our exports,” but no further details were provided.
“This MOU reflects Canada’s strategic approach to building a secure, competitive and sustainable energy future,” Hodgson said in the release.
“Canada and the Republic of Korea are trusted partners, and by deepening cooperation in critical minerals, clean energy technologies and energy security, we are diversifying our exports and strengthening resilience on both sides of the Pacific.
Critical minerals are one of the main economic projects of national interest described under Ottawa Budget 2025with Canada’s vast supply of minerals like nickel, cobalt, graphite and lithium, which are needed for battery production, energy storage, wind turbines and many other applications as part of the transition to green energy.
According to the International Energy AgencyThe global transition away from fossil fuels means demand for essential minerals could increase sixfold by 2040.
The statement said that by working with South Korean partners, Canada “will strengthen the automotive supply chain and enhance cooperation on critical mineral supply chains, the transition to clean energy and energy security.”
It adds that through this collaboration, Canada will “create opportunities and well-paying jobs for Canadians,” although no further details were provided on the number or types of jobs that could be created.
“Canada is an automotive nation and home to world-class workers, cutting-edge innovations and some of the best manufactured vehicles in the world. This new MOU with Korea builds on that heritage and positions Canada to become a leader in the next generation of automotive excellence,” Joly said in the release.
“By deepening cooperation in electric vehicles and hydrogen mobility, expanding partnerships in batteries and critical minerals, and attracting high-value investments to Canadian communities, this agreement will grow our auto sector, create good jobs, and strengthen Canada’s position as a global leader in manufacturing future-ready vehicles.
No details on the companies involved were provided, but some of the world’s biggest auto brands based in South Korea include Hyundai Motor Group, which is also behind the Kia and Genesis brands.
— With a report from Bryan Mullan of Global News.
© 2026 Global News, a division of Corus Entertainment Inc.
