As the 2024 presidential election in the U.S. nears, lawmakers in Canada are becoming more concerned about protectionist trade policies enacted by our neighbours down south. While president, Donald Trump threatened to take the U.S. out of the American Free Trade Agreement while also imposing tariffs on imported Canadian steel and aluminum products.
Comparatively, Joe Biden has consistently supported trade unions in the U.S., and another term for him would also mean risks will arise for Canadian manufacturing and energy exports going to the U.S. Because the future of trade with the U.S. is unreliable, policymakers in Canada should eliminate barriers to interprovincial trade to improve economic growth across the country.
According to an article recently published by the Fraser Institute, interprovincial trade barriers here in Canada add anywhere between 8% and 14.5% to the cost of goods and services. This adds up to economic costs of approximately $32 billion every year. Additionally, barriers affecting labour and trade mobility also have an impact on the productivity and growth of Canada’s economy. Some of the main non-tariff internal barriers include sector-specific regulations that differ from province to province and territory to territory, restrictions on alcoholic beverage sales, and dairy quotas.
Ultimately, provinces should focus on liberalizing trade as trade protectionism in the U.S. continues to grow. At BlueRock Wealth Management, we are always looking to provide information you may find useful, like the ideas included in this article. If you agree with this article’s points, consider contacting your MP with your thoughts.