Photo by: Lea-Kim
by Tolga Demiryol
October 2026
Table of Contents
- Introduction
- Why Turkey, Why Now
- Supplier, Sanctioner, Suitor
- The Terms of a Durable Partnership
- Conclusion
- About the Author
- Canadian Global Affairs Institute
Introduction
In April 2021 Ottawa cancelled 29 export permits for military goods bound for Turkey, among them permits for the sensors that equipped Turkey’s flagship drone, Bayraktar TB2. The primary source of contention was whether the technology was being transferred to third parties. Specifically, a federal review had found evidence that those sensors were being used by Azerbaijan in the Nagorno-Karabakh conflict. The export restrictions held until January 2024, and the rupture in Ankara-Ottawa relations was seemingly quite deep.
Yet the estrangement did not last. Canada and Turkey are rebuilding a defence relationship that collapsed only five years ago, and both parties have strong motivations for doing so. Within two years the two capitals were moving towards one another again. At the SAHA Expo defence fair in Istanbul in May 2026, Canada’s Secretary of State for Defence Procurement, Stephen Fuhr, called Turkey a trusted partner and put the rationale in plain middle-power terms: “Individually we’re just not big enough, but collectively we are.” The statement came with substance. Ottawa has reportedly opened early talks on acquiring Turkish medium-altitude, long-endurance (MALE) uncrewed aerial vehicles (UAVs); Kraken Robotics of Newfoundland signed a memorandum of understanding with the uncrewed-systems centre of a Turkish shipyard; and Fuhr identified ammunition, drones and counter-drone systems as the first areas for cooperation. The July 2026 NATO summit in Ankara pointed the same way.
Fuhr was restating, at the level of procurement, a proposition Prime Minister Mark Carney had put more broadly at Davos in January 2026. Carney’s argument was that middle powers negotiating alone with a hegemon “negotiate from weakness,” and that the answer is “variable geometry,” meaning different coalitions assembled issue by issue rather than a single bloc. Defence-industrial cooperation with Turkey is a test of what that method looks like applied to a specific capability, and a demanding one, since the two countries share interests without sharing much recent trust.
The sensors in question were Ontario-built, the eyes of the Bayraktar TB2, the aircraft that became the emblem of Turkey’s rise as a drone power. Ankara objected strongly. Seen from Turkey, an ally had withdrawn a critical component from a program already in service, which was the very exposure that Turkish industrial policy had been built to reduce. Asked at SAHA about the rift in defence cooperation between Canada and Turkey only a few years ago, Fuhr noted “Nobody’s raised any past information or anything that’s happened in the past,” adding, “Everyone is focused on responding to the moment and how we can work together moving forward.”
Fuhr’s remark points to two distinct factors shaping the emerging reset in Canada-Turkey defence ties. The first is a genuine opportunity, based on shared interests. Canada is seeking to reduce the concentration of its defence procurement in the United States, while Turkey’s industry was built through repeated efforts to escape foreign control over critical components and export permissions. What the two share is an interest in reducing the points of leverage that others control, an interest arrived at by different routes. The second is a problem of method. The relationship now being reassembled rests, for the moment at least, primarily upon diplomatic goodwill and a favour exchanged within NATO. The export-control dispute that ruptured the relationship in 2021 has been quietly set aside rather than genuinely resolved.
Canada-Turkey defence cooperation is an early test of whether the middle-power coordination the Prime Minister called for at Davos can produce anything more durable than a sequence of transactions. This report argues that it can, but only on certain terms: written end-use transparency agreed before contracts are signed; early projects anchored in NATO frameworks; and co-development preferred to off-the-shelf purchase. Terms of that kind would give both governments a stake in preserving the relationship when the circumstances that produced it change.
Why Turkey, Why Now
Turkey is courted today for two reasons: it has more to offer than it once did; and Canada has more reason than it once had to look beyond the United States. That second reason is not a search for a replacement partner, but rather to reduce Canadian exposure to any single foreign supplier. Canada’s Defence Industrial Strategy, released in February 2026, sets out to raise the share of defence acquisitions awarded to Canadian firms to 70 per cent within a decade, and its purpose is to reduce the exposure of Canadian programs to disruption in any single foreign supply relationship.
Turkey’s defence industry spent decades being built under embargo, and the investment now shows in the ledger. Turkish defence and aerospace exports reached US$10.05 billion in 2025, up from about US$7.1 billion the year before. The TB2, the indigenously developed MALE UAV, is combat-proven and inexpensive to field. Its maker, Baykar, earned 88 per cent of its 2025 revenue abroad. The company has signed TB2 export agreements with 36 countries. The aircraft’s reputation was made in Ukraine in 2022, where Ukrainian crews used it against Russian armour and supply columns in the opening months of the invasion, including the strikes on Russian landing craft near Snake Island that May. Its later record there is equally instructive. However, as Russian air defence and electronic warfare adapted, the TB2’s front-line strike role diminished, a reminder that a cheap airframe buys reach rather than immunity.
Turkey’s defence industry has quickly diversified beyond the affordable UAV sector. The inventory now includes indigenously developed land, sea and air platforms, ranging from the Altay main battle tank and armoured combat vehicles to MILGEM naval corvettes and uncrewed sea vehicles. Turkey’s most ambitious current program is KAAN, the next-generation fighter under development at Turkish Aerospace Industries (TAI), with entry into service targeted for the end of the decade. There is an intergovernmental agreement for the export of 48 KAAN fighters to Indonesia, with provisions for technology transfer and local industrial participation. Delivered as planned, the order would make Turkey an exporter of an indigenously developed combat aircraft. At the same time, Ankara’s own 2025 agreement to buy Eurofighter Typhoons shows a country still willing to import when it must.
What Turkey offers a partner is a combination that established suppliers rarely match: capable platforms; quick delivery; competitive prices; and a flexibility on technology-sharing that comes from its own long experience of being refused. Canada’s interest has a sharper and more recent cause. The defence relationship with the United States, long the unquestioned foundation of Canadian procurement, has become a source of uncertainty, including tariffs, talk of annexation and a Pentagon decision to pause the Permanent Joint Board on Defence. As Prime Minister Carney has noted, “seventy-five cents of every dollar of capital spending for defence goes to the United States,” an arrangement he called, bluntly, “not smart."
Turkey is a plausible partner, above all for joint development, because the two defence-industrial bases are complementary. Canada’s strength lies in subsystems, sensors and components; Turkey’s lies in integrating them into platforms it can field and export. The areas Fuhr named map on to needs that both countries already feel. Ammunition co-production addresses a shortage NATO is working to close, and counter-drone capability has become one of NATO’s fastest-growing capability requirements. Turkey, despite its progress in building sovereign capacity, still relies on foreign technology and supply chains where it has not yet closed the gap.
The capability claim is worth being specific about because the relevant aircraft are not the TB2 but the heavier types that followed it. Baykar’s Akıncı combines satellite communications for beyond-line-of-sight control with endurance beyond 24 hours. Turkish Aerospace Industries rates its Aksungur at up to 50 hours’ endurance, with satellite control beyond 5,000 kilometres, a payload above 750 kilograms that can carry maritime radar and electro-optical sensors. Akıncı has been flown with the Turkish Armed Forces since 2021, and the Turkish Navy has operated Aksungur since the same year. These characteristics could matter for surveillance across Canada’s three ocean approaches, though their fit with Canadian requirements has not been established. No Turkish platform has been demonstrated at high latitude in Canadian conditions, and cold-weather performance and satellite coverage above the Arctic Circle remain key unknowns. However, that is an argument for developing such a variant jointly rather than against the partnership.
Canadian procurement policy is already open to these possibilities. The Defence Industrial Strategy (DIS) divides acquisition into three tiers: build at home where Canada has strength or sovereignty requires it; partner with allies through co-development and joint production; and buy from allies where neither is available. Turkey figures in each. In the buy tier are the capabilities Canada needs quickly, and Turkish lines are already producing ammunition, above all, and counter-drone systems. In the build tier, Turkey appears as a customer rather than a supplier in the marine sensors and space-based surveillance the strategy treats as sovereign Canadian capabilities. The interesting tier is the middle one, where uncrewed systems for maritime and Arctic surveillance sit, and where the development cost is more than either would readily carry alone. Turkey is currently not among the partners the strategy names, which focus on the European Union, the United Kingdom and parts of the Indo-Pacific, so its place will depend on the industrial terms of a project rather than on alliance solidarity.
Where the reset lands among the three will determine how durable it proves, as a relationship built only around the buy tier would reproduce the structure that failed in 2021.
Supplier, Sanctioner, Suitor
The relationship that Canada and Turkey are rebuilding is not new, and the way it broke in the recent past should shape how it is put back together.
Canada was, first, a supplier for Turkey’s burgeoning defence industry. The electro-optical and targeting sensors of L3Harris WESCAM, built in southern Ontario, equipped the TB2 through its formative years in shipments Project Ploughshares values, from commercial trade data, at as much as C$301 million between 2017 and early 2020. Rotax engines from the Austrian subsidiary of a Quebec-headquartered firm powered the aircraft. Canadian parts were therefore more than incidental to the Turkish drone’s rise.
Canada became, next, a sanctioner. Ottawa suspended new permits in October 2019, after Turkey’s operation in northern Syria; relaxed the suspension; then froze exports in October 2020 after the sensors were reportedly identified on the units Azerbaijan flew in the Nagorno-Karabakh war in that year. A report suggested that the transfer to Azerbaijan was a possible breach of Canada’s end-use assurances, and in April 2021 the permits were cancelled outright. For a country that prides itself on one of NATO’s more careful export-control regimes, the episode showed that the regime has teeth. For Ankara, the shift in Canada’s policy was a major disappointment.
The freeze cost Canada a market and cost Turkey the time and money to replace what it had lost, and it is a lesson each capital now has reason to recall. Turkish industry responded as it did to every other embargo in its history, by substituting domestic capability for the denied import. Aselsan’s CATS turret replaced the Canadian sensor aboard Turkish aircraft and Baykar later announced an indigenous BM100 engine, and the TB2 continued to fly and, more importantly, to sell abroad.
Then came the courtship, which was motivated above all by tectonic geopolitical shifts. Ottawa lifted its restrictions in January 2024, once Turkey had ratified Sweden’s accession to NATO. The notice ending presumptive denial attached a condition of its own: Ankara was now expected to state whether Canadian goods would be re-exported or transferred to any non-NATO country, Ukraine excepted. WESCAM shipments resumed almost at once. Two years later, the government that had once cancelled the permits, reportedly found itself discussing the purchase of Turkish drones.
Within the span of a single decade, in other words, Canada has been in turn the program’s supplier, its sanctioner and its prospective customer. The courtship is not confined to defence either. Trade ministers agreed in Ottawa on 8 June 2026 to open exploratory discussions toward a free trade agreement, and on 7 July, meeting on the margins of the Ankara summit, Prime Minister Carney and President Erdoğan announced the formal launch of negotiations. The two tracks are already linked in the governments’ own language: the June statement commits them to explore partnership in aerospace, and to do so “including through defence, security, and related industrial cooperation.” Defence-industrial projects are the most politically exposed part of any economic opening, which makes them a test of whether the wider relationship can hold, and they are also where the rules are hardest to write.
The reset of January 2024 came through alliance diplomacy, part of the bargain that secured Sweden’s entry into NATO. It did tighten the terms, since Ottawa now requires notice of re-export outside the alliance. These are conditions Canada attached to its own permits, however, not a settlement of the disagreement that caused the rupture. Fuhr’s remark that “nobody’s raised any past information” indicates that the past goes unmentioned because neither government has an interest in raising it. This reticence is understandable, but it is ultimately not sufficient. To leave the rupture unspoken is to entrust the relationship to goodwill, and goodwill is the most perishable footing a defence relationship can have. Cooperation assembled issue by issue becomes durable only when the parties write down terms that will still operate once circumstances have changed.
The Terms of a Durable Partnership
In a partnership of the defence industry, durability begins with end use. Transparency must accompany any agreement. The aim should not be to place Turkey under suspicion, which would only serve to erode trust, but rather to give both parties the same assurance: a common, written understanding of how equipment may be used, reached jointly and in advance, in place of the divergent expectations that proved costly in 2021. The assurances of the 2024 reset, secured as they were amid the pressures of the NATO accession bargain, are better regarded as a starting point rather than a settled framework.
The benefit of building on them runs in both directions. For Canada, agreed terms on end use foreclose the prospect of another politically problematic reversal. For Turkey, and this is the point too often missed, they reduce the risk that a Canadian supplier might alter the terms of the relationship after deliveries have begun. Any confidence-building measure between the two parties should be institutional. A bilateral working group through which questions of end use are raised and settled as they arise would protect the relationship better than any last-minute assurance, and its mandate should include intellectual property, sustainment and third-country exports as well.
NATO provides the most credible institutional ground for this purpose, and it is the primary setting where Canada and Turkey are on the same side. The domains that Fuhr identified at SAHA – interoperability, allied production, counter-drone development and ammunition – already sit inside NATO capability priorities. That supplies a shared institutional setting, though it does not align two national export-control systems; each project would still need explicit agreement on approvals, end use and third-country transfer.
The materials’ layer of defence-industrial policy is now part of the same larger debate. At the Ankara forum on 7 July 2026, 12 allies including both Canada and Turkey launched a NATO project on defence critical raw materials, covering the acquisition, storage, transport and management of the inputs on which defence production depends. Canada enters it as a producer with, in the Prime Minister’s Davos phrasing, “vast reserves of critical minerals.” Turkey also holds 73 per cent of the world’s boron reserves and close to half of world production, including the boron carbide used in armour. Those positions do not by themselves make the two economies complementary. What the project offers is a venue in which that can be tested, and terms on processing, offtake and third-country access are easier to agree on before a supply relationship exists than after.
The European Union’s Security Action for Europe (SAFE) instrument points in the same direction. Canada concluded negotiations on 1 December 2025 and the European Council concluded the agreement in June 2026, making Canada the first non-European country with such an arrangement, under which Canadian firms may take part in SAFE contracts carrying up to 80 per cent Canadian content. Turkey may join SAFE common procurement as an EU candidate country, but it has no comparable bilateral agreement extending eligibility to Turkish firms and products. European governments working to expand ammunition and uncrewed-system capacity have every incentive to draw on a NATO ally with established export lines in both. The Baykar–Leonardo joint venture in uncrewed systems and Baykar’s acquisition of Italy’s Piaggio Aerospace are early signs of where this is heading. Whether Turkey secures terms comparable to Canada’s SAFE deal depends on political decisions within the European Union that lie beyond Ottawa’s control. For the present, therefore, NATO remains the common ground for cooperation.
The form of cooperation matters as much as its sector, for co-development is clearly preferable to off-the-shelf transactions in either direction. What collapsed in 2021 was a supplier relationship concentrated on a single critical Canadian component, which gave one government a decisive hold over the other’s flagship program. Joint development, in contrast, would spread intellectual property, production and sustainment more widely, and give both parties a larger stake in the relationship. It would not abolish sovereign export controls, and closely integrated production can create chokepoints of its own. Its advantage is that those dependencies, and the export rights attached to them, can be negotiated before development begins rather than discovered afterwards.
What the two governments stumbled into over the past decade – a mostly unplanned interdependence – would in this way be built in by design. Shared production, joint rights and local content on either side would give each party a reason to preserve the relationship and a cost to abandoning it. Such an arrangement also complements Turkey’s own procurement philosophy: Ankara’s insistence on technology transfer and a negotiated share of the intellectual property is not a negotiating quirk but rather a lesson learned from a long history of defence industrialization under embargo. Co-development also has a commercial rationale, since a jointly developed platform can be amortized across third-country demand that neither national market would sustain alone. In the strategy’s own terms, this is what the partner tier exists for, and why Canadian production, sustainment and a share of the intellectual property have to be designed into a first project rather than negotiated after it.
Conclusion
The opportunity before Canada is real. Turkey offers capabilities and a readiness to share technology that Canada will not easily find elsewhere. The two industries complement one another more than they compete.
The first obstacle, however, is not policy but familiarity. Canadian officials and firms have had little occasion to learn what Turkish industry now builds, and Turkish firms little occasion to learn how Canadian procurement, export control and industrial-benefit requirements work. That is why the near-term steps are mostly about contact rather than commitment. Within six months the Trade Commissioner Service and the Canadian Association of Defence and Security Industries (CADSI) could organize a firm-level mission attached to CANSEC, SAHA or the International Defence Industry Fair (IDEF), built around identified Canadian requirements and matched meetings between Canadian suppliers and Turkish platform integrators. Research partnerships between defence laboratories and universities are slower and less visible, yet they are where an eventual co-development project would find the people to staff it.
Above that sits the dialogue itself. Within the year, the two governments should establish a standing defence-industrial forum sponsored by Canada’s Secretary of State for Defence Procurement and Turkey’s Secretariat of Defence Industries, with the Defence Investment Agency, which now holds the industrial-benefits authority. The Departments of National Defence, Global Affairs and Innovation, Science and Economic Development should also be represented at working level. Its first work would be unglamorous: a bilateral capability map, and a written template covering end use, intellectual property, sustainment and third-country exports, agreed before a first pilot project rather than after it. The forum should select a demonstration project inside that first year and run it in the 12 months following. Counter-drone technology is a manageable first test among the areas Fuhr named, and it would exercise interoperability, export-control compatibility and Canadian industrial participation before either government commits to a platform. The NATO project for critical raw materials offers a parallel and arguably easier place to begin.
For now, the relationship stands on diplomatic warmth and a single NATO bargain that, this report has argued, is insufficient for a long-term partnership. Variable geometry, in this case, would run through NATO and through bilateral industrial arrangements rather than through a new coalition. Whether the courtship becomes credible middle-power coordination will depend on whether it produces shared capacity and reciprocal commitments able to survive a change in political circumstances. Within a single decade, Canada has been Turkey’s supplier, its sanctioner and now its suitor. Whether it can become something more lasting, a partner whose commitments outlive the circumstances that made them, is now a question of terms rather than of goodwill.
About the Author
Tolga Demiryol is Dean of the Faculty of Economics, Administrative and Social Sciences and Professor of Political Science at Altınbaş University in Istanbul. He holds a PhD in political science from the University of Virginia and was a Fung Global Fellow at Princeton University, where he researched the use of geoeconomic instruments in foreign policy. A scholar of international political economy, his current research centres on the geopolitics of defence as well as the strategic choices facing middle powers under intensifying great-power competition. His recent work on Turkish drone power and middle-power strategy has appeared in Third World Quarterly and the Georgetown Journal of International Affairs.
Canadian Global Affairs Institute
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