Following years of protectionist policy towards UAE carriers, in late 2025, Ottawa expanded Canada’s air agreements with both Saudi Arabia and the United Arab Emirates, in a move reported by Open Jaw.
The terms allow for up to 14 weekly Saudi flights and 35 from the UAE, opening the door for carriers such as Emirates, Etihad, and Saudia Airlines to throw capacity at Canada.
The potential for an onslaught of seats has led to editorial concerns that Middle Eastern carriers could siphon traffic and hurt Canadian carriers if they don’t up their game.
Middle Eastern airlines are powerful rivals. Their reputations for superior premium cabins, including plush seating, private showers, bars and top service combine with a strong hold on connecting traffic, attracting a non-premium market to a broad network of destinations with inexpensive seats.
According to its current route map, Emirates connects passengers beyond Dubai to 24 destinations across the Indian subcontinent and East Africa–key destinations for Canada’s extensive VFR market.
McGill professor John Gradek told the CBC Canadian airlines "will be hard pressed to match" the experience that airlines from the Middle East are offering.
In conversations with Robert Kokonis, President of Toronto-based AirTravel Inc., Open Jaw was offered a broader perspective. Kokonis says the view misses key aspects of a bigger picture.
“First and fundamentally, increased competition is good for consumers because it gives additional choice and incremental seat capacity can lead to lower ticket pricing.
"Second," Kokonis outlines, “opening greater access to Canada for these carriers may give other Canadian airports, and not just Toronto and Montreal at present, the ability to offer travellers in their communities nonstop air connectivity to some of these large Middle East hubs."
There’s also the spillover effect on other businesses, “direct connectivity drives hotels, restaurants, ground transportation, and tourism, supporting both business and leisure travel”. He goes on to add, “it’s not just about passengers on an Etihad flight, for example—if a city like Edmonton improves access to the Middle East, multinational firms may decide to open offices there. That brings in global business travel, investment, and broader economic development.”
Third, Kokonis believes that increased competition from the Gulf carriers presents an opportunity for Canadian airlines to deepen loyalty tie-ins and strengthen partnerships. “Carriers that leverage codeshare and loyalty program agreements, such as the partnership between Air Canada and Emirates, will be better positioned than those focused on routes alone.”
Kokonis’ last but perhaps most important perspective: There has been little consultation by the Canadian government on how expanded Gulf carrier access could impact Canada's aviation ecosystem, airlines, and workers.
“There is a disequilibrium between the user-pay aviation model and labour costs in Canada compared with state-owned Middle East carriers," he notes. "It’s fairly well-known equity injections and loans from sovereign wealth funds have supported aviation infrastructure for airports and airlines in that region.”
"Therefore we need to understand if expanded access to Canada represents a risk for jobs in our aviation ecosystem. I believe there will be a net benefit to Canadian businesses, travellers, and communities by expanding direct air connectivity to more overseas markets," he concludes.
Air Canada has leaned into that strategy by extending its partnership with Emirates through 2032, as Open Jaw reported in November. It expands codeshares and reciprocal loyalty benefits, including lounge access and broader redemption options such as Premium Economy.
This partnership enables Canada’s largest carrier to more fully participate in connecting traffic opportunities beyond Emirates’ Dubai home base, and vice versa, giving Emirates enhanced connection opportunities for passengers beyond its Canadian gateways in Montreal and Toronto.
Since 2022, more than half a million passengers have connected across the combined networks, which now span 56 routes linking 37 destinations in Canada and the US, alongside Emirates-operated flights to India, the Middle East, and Southeast Asia. Air Canada operates daily Toronto-Dubai and Montréal-Dubai Dreamliner service, with eligible passengers accessing Emirates’ Airbus A380 connections and Dubai Terminal 3 facilities.
Oliver Martin, Senior Director. Innovation at Skift, says the implications extend beyond airline partnerships to Canada’s broader tourism strategy.
“Canada’s focus-market strategy didn’t happen by accident,” Martin wrote in a LinkedIn post last week, noting he was at Destination Canada in the early 2000s when the Market Performance Assessment Model was first developed. "It was a deliberate shift away from the more than 25 markets we were spread across at the time, many selected because of diplomatic priorities or anecdotal promise," as well as where "data showed demand, conversion, and ROI were strongest."
That approach served Canada well, he says—but the landscape has changed.
“Two decades later, the model needs a serious rework,” Martin says. "High-value travellers Canada is trying to attract are no longer concentrated in a handful of 'traditional markets.' They are increasingly global, mobile, and influenced through aviation and digital ecosystems rather than national borders.
"More demand now flows through the big connecting hubs–not just the European and North American carriers, but across the Middle East's and Asia’s transit gateways–linking Canada to established and growing middle-class markets in Africa, South Asia, and Southeast Asia."
With expanded air service agreements and airlines like Emirates, Etihad, Saudi Airlines, and others deepening lift into Canada, the risk iso longer being spread too thin," Martin concludes. "It is missing where future demand will originate."
