Canada’s economic response to U.S. tariffs combines internal trade liberalization and large-scale infrastructure development to boost self-sufficiency, diversify markets, and drive sustainable domestic growth.
Bill C-5 and Ontario’s Bill 5 streamline trade and project approvals, aiming to cut red tape, unify regulations, and fast-track nation-building efforts across provincial and Indigenous jurisdictions.
High-impact potential projects include carbon capture, renewable energy, and mineral extraction, with strategic goals of reducing emissions, enabling green tech, and enhancing resource access in northern and coastal regions.
Not surprisingly, due to the new stiff tariff penalties being imposed on most Canadian goods shipped to the United States, Canadian exports have recently experienced a historically large drop in dollar volume. Traditionally, approximately three-quarters of Canada’s foreign sales have been to U.S. customers.
There has been a longstanding mutually beneficial trading relationship between the two nations. One of the partners (i.e., the U.S.), however, has now opted for a different, more restrictive framework, leaving the other (i.e., Canada) to consider what it might do to alleviate lost business and maybe even pluck some tangential benefits from altering its internal and external trading arrangements.
In quick fashion, accord has been struck among all of Canada’s governmental leaders ‒ the Prime Minister federally and the Premiers at the provincial and territorial levels ‒ that two simultaneous courses of action warrant the most attention and effort.
First among these is to expand on the Canadian Free Trade Agreement of 2017, with the intent of counterbalancing declines in U.S. trade by eliminating interprovincial barriers to trade. In other words, there’s value in trying to make up the shortfall by tearing down regulatory, certification, packaging, and many other restrictions on the flow of products, services, and labor within Canada.
Several provincial legislatures have already ratified or are on tap to assure a more dynamic east-west streaming of economic activity. Among these are Nova Scotia’s Bill 36 (The Free Trade and Mobility Within Canada Act), Quebec’s Bill 112 (An Act to facilitate the trade of goods and the mobility of labour from the other provinces and the territories of Canada), and British Columbia’s Bill 7 (the Economic Stabilization (Tariff Response) Act). They are all about ensuring that any good, service, or worker acceptable in one province is considered likewise in another.
Second, there has been a recognition of the need to prioritize and speed up what have come to be termed ‘nation-building’ projects. From the laying down of the Canadian Pacific Railway ties and tracks to the West Coast, and most heartrendingly captured in Gordon Lightfoot’s Railroad Song Trilogy, to the excavation of the St. Lawrence Seaway, Canada has a gold-plated record on this score.
On several occasions in the past, infrastructure spending initiatives specifically designed to stimulate GDP growth have been launched. These initiatives always placed an emphasis on shovel-ready projects that could be launched with the shortest lead times.
The ‘nation-building projects’ approach is an evolutionary step. It will promote resource development, plus cargo shipping investments, to reach new trading partners as alternatives to the U.S., while staying true to clean environment goals and offering more stake-holding ownership opportunities to Indigenous communities.
The Mark Carney Liberal government aims to pass Bill C-5, the One Canadian Economy Act, by July 1. It includes:
Complementing this, Ontario passed Bill 5: Protecting Ontario by Unleashing Our Economy Act 2025, enabling:
However, Indigenous advocates have raised concerns over limited consultation mechanisms.
This is only a short compilation. There are many other possibilities for a nation-building project list, including nuclear reactors (e.g., Ontario Hydro has committed to and is proceeding with a small modular reactor/SMR at its Darlington location); AI data center hubs tied to the wealth of green power generation availability in Canada; and an already under-study electricity transmission corridor running across largely inaccessible, for now, regions of mid- to northern B.C.
Construction economy news and insights you can act on.
At ConstructConnect, our software solutions provide the information construction professionals need to start every project on a solid foundation. For more than 100 years, our keen insights and market intelligence have empowered commercial firms, building product manufacturers, trade contractors, and architects to make data-driven decisions, streamline preconstruction workflows, and maximize their productivity. Our newest offerings—including our comprehensive, AI-assisted software—help our clients find, bid on, and win more projects.
ConstructConnect operates as a business unit of Roper Technologies (Nasdaq: ROP), a constituent of the Nasdaq 100, S&P 500, and Fortune 1000.
For more information, visit constructconnect.com