Economic security for now and our future

Hey there, time traveller!
This article was published 26/02/2025 (237 days ago), so information in it may no longer be current.

U.S. President Donald Trump’s talk of tariffs, trade and what’s best for Canada has driven Canadians to think about what we can do, as a nation and individuals, to protect our country, our economy and our jobs. Where this all ends is deep in a rabbit hole of conjecture.

It would be dangerous, however, to underestimate the potential impact that a tariff war with our largest-by-far trading partner can cause to Canada’s health, wealth and security.

Here’s why: Canada’s economy is tied tightly to the U.S. because of the integration of many sectors of production. Canada is America’s largest buyer of goods (above 17 per cent); 76 per cent of Canadian exports go to the U.S.

More than 65 per cent of Canada’s GDP — the generation of revenues that fund our social programs and core services — flows from trade. More than half of Manitoba’s GDP is tied to trade; 72 per cent ($18 billion) of our annual exports go to the U.S.

Caught in this firm geopolitical grip, how can we protect our economic and national security? The answer is not simply to “buy Canadian.” We produce far more than we could ever consume ourselves.

There is no quick and easy fix but as we all now see a big part of the solution starts with easing our reliance on one customer. We have to diversify, expand and develop new global markets.

That’ll take some work.

Canada has been a bit lazy in seizing global trade opportunities; we’ve fallen complacent having the world’s largest economy next door.

We have signed numerous multi-nation trade agreements, yet we’ve not done nearly enough to chase those markets or to ensure we can move product quickly, cheaply and reliably.

Predictability is everything in business. That reliability requires seamless, efficient and connected trade gateways and corridors because if you can’t move it, you can’t sell it.

But Canada has neglected its trade infrastructure. As a result, our reputation around the world has suffered. In 2009, a World Economic Forum survey of global transportation network quality ranked Canada in the top 10; a decade later we had fallen to 32nd in rank, below Azerbaijan.

Surveys of buyers and sellers, here and abroad, indicate Canada is regarded as a country that can’t be depended upon for the efficient movement of goods and commodities across borders.

The Canadian Centre for Economic Analysis points out that Canada’s trade transportation investment programs have come in fits and starts. That “volatility” damages our reputation and hobbles the potential return on investment to GDP. We are leaving billions on the table for lack of strategic investment thinking.

Meanwhile, countries we compete with in the global arena — targeting the same markets where we have signed trade agreements — have secured those ties and adopted trade infrastructure strategies that look 20 and 30 years out to prioritize and co-ordinate nation-building infrastructure projects offering the highest return on investment to GDP.

Canada’s trade corridors and gateways need a lot of love. As we’ve seen in the supply-chain troubles during the pandemic or the sudden, cataclysmic impact of “weather bombs” on the West Coast, our country is vulnerable to big economic pain when trade is severely disrupted.

More than two million jobs, countrywide, rely on the health of our trade.

Provincial premiers know this.

That’s why the Council of the Federation unanimously endorsed the principles of a proposed Canada Trade Infrastructure Plan (CTIP) — a roadmap through public-private collaboration to map out a strategy like those other countries are using to amplify trade relations and market returns.

At its core, CTIP, proposed by leading national business organizations, offers a “how to” for building an investment strategy, using recommendations in the Canada West Foundation’s 2020 report From Shovel Ready to Shovel Worthy.

It’s the start of a solution. Its time is right. And it’s sitting on the desks of federal and provincial leaders.

Canada is being held hostage to the fever dreams of an American president intent on unravelling the rational, rules-based order which historically has supported our mutual prosperity.

Canada needs a plan that supports our country’s economic, social and national security.

We need to expand or connect to new trade routes. CTIP would get us started on that path.

Buying Canadian is good.

But better still, tell your MP you want to see the next federal budget lay out the first steps to a long-term trade infrastructure investment strategy, to help Canada protect its economy, diversify and compete globally for trade.

Chris Lorenc is president and CEO of the Manitoba Heavy Construction Association and of the Western Canada Roadbuilders & Heavy Construction Association.