A bit of good news. The link is from MSN because there is no paywall but the article is from the National Post.
My biggest surprise in reading this was the fact that our trade with the US went from 84% of total exports in 2005 down to 76% in 2024 - so the downward trend of trade with the US and greater diversification to the rest of the world has already been ongoing over the last 20yrs. Yes its only 8% but that downward trend was already naturally occurring with no direction or intent at the Federal Government level, I expect that the trend will only increase over the next 20yrs. If the 8% was to increase by 50% to 12% that would mean that just over 60% of our trade would be with the US, at 62%.
The worst is behind us': Canada's economy is defying some of the grim forecasts about Trump's tariffs
While the trade war has indeed caused unemployment spikes, supply chain disruptions, and a rough second quarter, in terms of growth, Canada has largely been defying the odds in some surprising areas. The question is, can it hold in 2026 and beyond?
“In terms of shock to the Canadian economy, the worst is behind us,” said Andrew DiCapua, the principal economist at the Canadian Chamber of Commerce.
Canadian exports to the U.S. that are not compliant with the Canada-U.S.-Mexico Agreement (CUSMA) face 35 per cent tariffs. There’s a 10 per cent tariff on non-CUSMA-compliant potash and energy, a whopping 50 per cent tariff on all Canadian steel, aluminum, and copper exports to the U.S., and a 25 per cent tariff on (non-U.S. content in) cars and light trucks. Non-CUSMA-compliant auto parts face an additional 25 per cent tariff, and softwood lumber is being tariffed at around 35 per cent.
"....the Canadian Chamber of Commerce’s Business Data Lab (BDL) crunched the numbers to see which Canadian cities were the most vulnerable — looking at U.S. export intensity and dependence on America, a key export market.
Topping the list were Saint John, N.B., home to the country’s largest crude oil refinery, at a 131.1 per cent exposure rate, followed by Calgary, thanks to it being a major crude oil and natural gas exporter that also exports a lot of beef. Southwestern Ontario’s cities, including Windsor, Kitchener-Cambridge-Waterloo, Brantford, and Guelph, Canada’s automotive hub, came in third through sixth.
Since the projections, the hardest hit areas have proven to be concentrated in Ontario and parts of New Brunswick, reflecting their reliance on automotive manufacturing, steel, aluminum, and lumber.
“I’d say, for the most part, our emphasis on the acute difficulties in southern Ontario have been correct,” said DiCapua.
But areas like Saint John, Calgary and many other Alberta cities, which topped the BDL’s list, have been more insulated from tariffs than Southern Ontario because the energy sector has faced lower tariffs.
Karen Chapple, director of the School of Cities at the University of Toronto, said she initially feared “that this would be more of a small town story” with one-plant towns of 20,000 or so throughout Ontario bearing the brunt. But when she looked at her database, mapped out nationally, she was surprised by the level of impact on cities.
“I don’t think of Toronto as being a place where you have a lot of manufacturing,” Chapple said, “but it gets hit … not necessarily downtown, but the outskirts of the region.”
It’s similar with steel and aluminum.
“I associate steel plants with small towns, but it really hits the entire metropolitan areas of Montreal and Toronto because they’re doing so much and making so many products that involve steel or aluminum,” she added
The first three quarters saw significant manufacturing job losses amid all the uncertainty — especially concentrated in the auto corridor of Ontario. But some regions and sectors have shown remarkable resilience.
“If you take the last two months, we’ve seen some rebounding in the manufacturing sector,” said DiCapuo, noting that the country is still down 12,000 manufacturing posts since January.
Manufacturing sales saw a rebound in September, rising 3.3 per cent following August’s one per cent drop, according to Trading Economics. That is Canada’s highest growth rate since Trump announced the tariffs — with sales improving for two-thirds of the subsectors.
Also, many assumed that consumer demand would plummet this year, and while retail sales have been volatile, they’ve generally gone up. They are projected to hit $649.8 billion this year for a 2.4 per cent increase over 2024, according to IBIS World.
This, combined with a surging “return to office” trend this year, means “both retail and office have done surprisingly well this year,” said William Strange, an economics professor at the University of Toronto, noting how many Canadian employers have moved away from their remote work models, embracing more in-office schedules.
Roughly 75 per cent of Canadian exports head to the U.S., so Ottawa has been promoting trade diversification in the face of Trump’s tariffs as a way to reduce future vulnerabilities.
DiCapua pointed to progress already been made in getting Canadian products, especially oil and natural gas and some agricultural products, to other markets, particularly in Asia and Europe. “The value is still low relative to what we’ve lost to the United States, but there are some encouraging trends there,” he said.
But Canada’s heavy trade dependence on the U.S. isn’t a new problem. Back in 2005, 83.8 per cent of Canada’s exports were to the U.S., and it took a long time to trim that down to 76.4 per cent last year.
www.ctvnews.ca
