Guten Morgen. Ich bin Ethan Lou. Every once in a while, Canada rediscovers Europe. Each time the rhetoric has been lofty. But each time, the pull of geography has brought Canada back to the United States. Even now, with tariffs mounting and calls for a European lifeline growing louder, Canada risks repeating that familiar pattern. Prime Minister Mark Carney made a big trip to Germany in August. I was there, and I will tell you what you didn\u2019t see.<\/p>\n
Up firstIn the news<\/p>\n
Trade:<\/b> U.S. President Donald Trump announced a new round of punishing U.S. tariffs<\/a>, including 100 per cent duties on imported branded drugs. Meanwhile, Ottawa dropped countertariffs on a broader range of U.S. goods<\/a> than initially indicated last month.<\/p>\n Executive: <\/b>Constellation Software founder Mark Leonard resigns<\/a> prompting shares to extend a recent plunge after investor pressure<\/p>\n Labour: <\/b>Postal workers announce immediate strike after Ottawa directs Canada Post to end door-to-door delivery<\/a><\/p>\n M&A: <\/b>Financial services giant Raymond James acquires<\/a> adviser teams from Richardson Wealth with $1-billion in assets<\/p>\n On our radar<\/p>\n Open this photo in gallery:<\/a><\/p>\n German Chancellor Friedrich Merz, receives Canadian Prime Minister Mark Carney in Berlin, Aug. 26.Soeren Stache\/The Associated Press<\/p>\n In focusCanada wants to be more European, but can it?<\/p>\n Hallo, I\u2019m the opinion editor in Report on Business. This summer I was one of two Arthur F. Burns fellows from The Globe in Germany. I spent two months in Berlin and reported on Prime Minister Carney\u2019s trip there.<\/p>\n Two days before Carney swept into the city<\/a> with military honours and quipped \u201csign me up\u201d after touring a U-Boot at a shipyard, I wandered through Germany\u2019s foreign ministry open house and found Canada looking a little small and cheap. Denmark offered Lego and liquor. South Africa had an opera singer and wine. We had a bingo sheet asking, \u201cWhat is the name of the Prime Minister of Canada?\u201d and rewarded visitors with a single maple syrup candy.<\/p>\n It was a tiny tableau, but it nagged at me: In a season of grand talk about \u201cnew corridors\u201d and \u201creliable partners,\u201d how big do we really look up close? <\/p>\n Open this photo in gallery:<\/a><\/p>\n Merz (L) and Carney (R) walk during a welcoming ceremony in Berlin.ANNEGRET HILSE\/AFP\/Getty Images<\/p>\n That question is the spine of this weekend\u2019s feature. It opens with that small scene \u2014 call it soft-power minimalism \u2014 and then tracks the much larger story: Ottawa\u2019s attempt to pivot meaningfully toward Europe<\/a> just as U.S. tariffs bite and the 2026 review of the United States-Mexico-Canada Agreement looms<\/a>. Berlin was Carney\u2019s fourth European trip as prime minister. A Canada\u2013Germany critical-minerals pact was signed. On paper, it reads like momentum<\/a>. <\/p>\n But the pact isn\u2019t binding, German media barely noticed, this country hasn\u2019t had an ambassador to Germany for more than a year, and there is still no Canadian chamber of commerce based in in the country.<\/p>\n<\/p>\n The piece tries to reconcile those two truths: the urgent case for diversification and the stubborn pull of geography. We\u2019ve been here before \u2014 in the 1970s \u201cThird Option\u201d moment, in Chrystia Freeland\u2019s 2017 \u201cclear and sovereign course<\/a>\u201d speech. Exports to Europe<\/a> have grown, yes, but as a share of Canada\u2019s total exports, the needle hasn\u2019t moved. The problem: decades of infrastructure, standards and supply chains built around one customer.<\/p>\n Mentions of Europe on TSX-listed companies\u2019 conferences calls haven\u2019t budged, while references to the USMCA have spiked; major players are still sending capital south; many industries say the opportunities aren\u2019t there in Europe. <\/p>\n In between, there were the hedges: Natural Resources Minister Tim Hodgson, also in Berlin, talked up liquefied natural gas only \u201cif demand is here and infrastructure is built\u201d; a Port of Churchill timeline measured in half-decades at the most optimistic; a hydrogen plan still waiting to materialize.<\/p>\n<\/p>\n It\u2019s not that the pivot to Europe is performative \u2014 but it will only stick if Ottawa matches the rhetoric with patient, unglamorous work: de-risking truly strategic projects (and only those), fixing a long-troubled foreign service, making trade help legible to small and medium businesses and nudging capital toward sectors less shackled to geography (artificial intelligence, quantum, clean tech).<\/p>\n If you take one thing away from this piece, let it be this: Diversification is a long game measured in percentage points and persistence, not headlines. In Berlin, the opera was literal. Ours will have to be figurative \u2014 and sustained.<\/p>\n Bis sp\u00e4ter. <\/p>\n ChartedTaking a hit<\/p>\n The interim parliamentary budget officer is warning that Ottawa\u2019s fiscal standing is alarming<\/a>, and that the country\u2019s public finances will be unsustainable without changes. \u201cWe don\u2019t lightly use the word \u2018unsustainable,\u2019\u201d said Jason Jacques. The forecast, which comes as Carney\u2019s government is preparing to table its first budget on Nov. 4, does not include any campaign commitments that haven\u2019t been rolled out yet.<\/p>\n BookmarkedOn our reading list<\/p>\n Virtuoso: <\/b>Canadian piano prodigy Ryan Wang<\/a> is headed for the competition of a lifetime.<\/p>\n Movement: <\/b>Trump signs executive order declaring TikTok sale meets<\/a> U.S. requirements.<\/p>\n Tempo: <\/b>FinTRAC issues a nearly $20-million penalty<\/a> against crypto exchange KuCoin.<\/p>\n Attention mortgage seekers<\/p>\n Are you mortgage shopping? If you are under age 40 and shopping for your first mortgage, or looking to renew one in 2025 or 2026, we\u2019d love to hear your story for an upcoming episode of our Stress Test podcast. How are you preparing? What options are you considering? What do you find confusing? We\u2019re looking to speak with Gen Z and Millennial Canadians who are navigating these changes. To participate, please email host Roma Luciw<\/a> or Zahra Khozema<\/a>.Morning update<\/p>\n\n