The recent surge in memorandums of understanding (MOUs) under Prime Minister Mark Carney’s administration marks a significant shift in how the Canadian government approaches collaboration with provincial authorities and international partners. As these agreements proliferate, they are redefining the landscape of governance, signalling a commitment to strategic partnerships that aim to facilitate major projects across various sectors.
The Rise of the MOU
In the past year and a half, Carney’s distinctive communication style has permeated Canadian political discourse, introducing terms that reflect a banking background and a focus on strategy. The MOU has emerged as a cornerstone of his administration’s approach, often used to express a commitment to progress and collaboration.
For example, the federal government recently unveiled a monumental $20 billion MOU with British Columbia, aimed at addressing concerns over Alberta’s pipeline developments. This move came shortly after Carney’s meetings with the President of the Philippines, where two additional MOUs were signed to enhance tourism and cultural exchanges. Just this week, Carney visited Saudi Arabia, promoting 13 agreements and MOUs valued at over $1 billion, encompassing sectors from health technology to infrastructure.
Understanding MOUs: A Tool for Alignment
At their core, MOUs serve as preliminary agreements intended to clarify mutual intentions between parties before embarking on complex projects. Jeremy Barretto, a regulatory partner at Torys LLP, describes MOUs as straightforward documents that articulate broad goals without imposing binding obligations.
“They are typically not very long or complicated and can be non-binding on the parties,” Barretto explains. This flexibility allows governments to establish common ground on various issues, from regulatory frameworks to project development, without the lengthy and often costly processes associated with formal contracts.
While critics might dismiss MOUs as mere paperwork, Barretto insists they play a crucial role in ensuring that diverse stakeholders work towards shared objectives. In contexts where provincial and federal policies have historically diverged—particularly in Western Canada—MOUs can be instrumental in fostering collaboration.
Political Implications: Navigating Complex Relationships
The recent MOUs signed by Carney’s government, such as those between Alberta and British Columbia, illustrate the delicate balancing act required in Canadian federalism. Michael Wernick, former clerk of the Privy Council, views these agreements as essential alignment exercises that help unify disparate interests.
“Essentially, the Alberta government and the oil and gas sector have, after 18 years, finally accepted there is never going to be an oil pipeline to northwest B.C.,” Wernick notes. He also points out that B.C. Premier David Eby has softened his stance, acknowledging the inevitability of oil traffic through southern terminals.
The broader implications of Carney’s MOU strategy could lead to a cascade of demands from other provinces seeking similar agreements. Wernick regards this as “totally normal federalism,” a necessary aspect of managing the diverse needs of a country comprised of multiple jurisdictions.
The Road Ahead: Implementation Challenges
Despite the optimistic framing of these MOUs, the real test lies in execution. Wernick anticipates that 2026 may be remembered as a pivotal year for negotiations and deal-making, with the subsequent focus shifting towards implementation.
“Are you actually going to hit the mark on all these strategies and frameworks and agreements and MOUs?” Wernick questions, emphasising the importance of real results over mere declarations of intent.
Why it Matters
As the Carney administration continues to embrace MOUs as a strategic tool, the implications for Canadian governance are profound. These agreements not only symbolise a commitment to collaboration but also reflect the complexities of balancing regional interests with national priorities. The effectiveness of this approach will ultimately be judged not by the number of MOUs signed but by the tangible outcomes they produce. As Canada navigates its energy, environmental, and economic challenges, the success of these agreements could redefine the future of intergovernmental relations and project development in the country.