The Philippines and Canada are targeting the completion of negotiations for a bilateral free trade agreement (FTA) within the year as both countries seek to diversify trade ties amid shifting global economic dynamics.

The agreement serves as a priority economic deliverable as Manila deepens engagement with partners beyond its traditional markets.

Speaking at a conference organized by the Stratbase Institute and the Asia Pacific Foundation of Canada over the weekend, Trade Undersecretary Ceferino Rodolfo said the Philippines aims to conclude negotiations on the FTA this year as it prepares to chair the Association of Southeast Asian Nations in 2026.

Rodolfo said the Philippines–Canada FTA could even be finalized ahead of a broader Canada–ASEAN trade agreement, noting that both governments have expressed interest in advancing the negotiations quickly.

The push comes as countries reassess trade dependencies and supply chains in an increasingly complex geopolitical environment.

Former Canadian Minister of International Trade Mary Ng said Canada’s heavy reliance on the United States as an export market highlights the need for diversification.

About 75 percent of Canadian exports currently go to the U.S., she said, adding that overdependence on a single market could pose risks to economic security.

Rodolfo said the Philippines could serve as a gateway for Canada to the ASEAN region, which is projected to become the world’s fourth-largest economy by 2030, while Canada could provide the Philippines with stronger access to the North American market under the United States–Mexico–Canada Agreement.

Both officials emphasized the role of so-called “middle power diplomacy” in building alternative and resilient trade networks.

Mining policy shift

The planned trade expansion also aligns with the Philippines’ push to strengthen its role in the global supply chain for critical minerals.

At the same forum, Environment Undersecretary Carlo Primo David said a new executive order on mining is awaiting the signature of President Ferdinand Marcos Jr.

The order aims to clarify provisions in the country’s mining policy and designate mining developments as national projects, with private companies operating as contractors for the state.

Among the proposed measures is a “use it or lose it” policy that would allow the government to reclaim idle mining permits that have not been developed for years. These permits could then be offered through public bidding to firms ready to begin operations.

The government is also seeking to encourage more downstream processing of minerals to increase the value generated from the country’s resources.

The Philippines is currently the world’s second-largest exporter of raw nickel, but officials say only a small portion of its mineral reserves is being developed.

To address investment barriers and high electricity costs associated with mineral processing, David proposed establishing shared processing facilities supported by government and private sector partnerships.

Under the model, nearby mining operations would supply ore to common processing centers, allowing the country to capture more value from the critical minerals supply chain.

David also invited Canadian companies to invest in the sector by providing capital and technical expertise.

Rodolfo said the two countries are also discussing a potential agreement on critical minerals, similar to a memorandum of understanding signed recently between the Philippines and the United States to strengthen supply chains for clean energy technologies.

Ng said discussions are also underway on forming a strategic partnership among Canada, the Philippines, and other like-minded countries to develop capabilities in mineral processing and related industries.