2024 U.S. Election: Recommendations to Canadian Governments to Work with Either Administration

As our previous two policy releases on the U.S. election established, Canada’s trading relationship with the United States is immensely valuable to the Canadian economy. However, recent polling from Janet Brown Opinion Research, commissioned by the Calgary Chamber of Commerce, found that 54 per cent of Albertans believe Canadian governments are not effectively championing Canadian economic interests south of the border. This is particularly notable, as 83 per cent of respondents expect the election to impact Alberta’s economy – and therefore expect their governments to be focused on cross-border relations. To support policymakers as they seek to enhance Canadian competitiveness and prepare for either outcome of the U.S. election, we have developed recommendations to ensure our relationship with the United States continues to be prosperous for the business community in Calgary, Alberta and across Canada.

Team Canada Approach

Governments – at the political level and across departments – must work together to forward our trade and international relations ambitions to ensure we continue our beneficial relationship with the United States. Developing cohesive narratives around the strategic importance of Canada, and the value of supporting a ‘buy North American’ strategy rather than a ‘buy American’ strategy, will be key to ensuring officials in Washington and across various states understand the value of the Canada-U.S. trade relationship. Moreover, ensuring Canadian domestic policy is clear, consistent and competitive relative to the United States and other jurisdictions is critical as we continue to compete for investment despite our smaller economy. At the same time, showcasing our strategic value to the United States, whether it be in energy, critical minerals, manufacturing, agriculture or other sectors, will be fundamental as the new administration contemplates policy changes and as we commence trade negotiations.

Canadians expect their governments to be forward-thinking and strategic as it relates to trade policy, particularly with the election unfolding in the United States. Ensuring cohesive plans are in place to advance our economic interests, compete with the U.S. and insulate our business community from adverse outcomes is necessary to our continued prosperity.

Invest in Supply Chains, Trade Infrastructure and Energy Security 

To demonstrate the value of Canadian commerce, we must ensure reliable, predictable and secure trade infrastructure and supply chains – in goods, services and products. Recently, global confidence in Canada’s trade infrastructure has been consistently dropping: in the past 15 years, our infrastructure has gone from being ranked 10th best globally to 26th. Even more troubling, specifically relating to transportation infrastructure, we now sit at 32nd internationally. Without reliable infrastructure, Canada cannot be viewed as a favourable place to do business, and therefore we undermine our competitiveness and bargaining power with the United States as the new administration sets their trade policy direction.

To get our products to market reliably and demonstrate the security of our supply chains to trading partners, we need to make targeted and strategic investments in transportation and trade infrastructure across the country – including rail and port capacity. Moreover, governments – federal, provincial and territorial – must collaborate in defining Canada’s national trade corridors and commit to better collecting and utilizing trade and transportation infrastructure data to understand the gaps in our trade infrastructure. By collecting and utilizing data, governments can develop a fulsome understanding of the gaps in our infrastructure systems and address them accordingly.

Once defined, we should seek to adopt already established international best practices from other jurisdictions and build upon Canada’s previously successful trade infrastructure projects, such as the Asia-Pacific Gateway and Corridor Initiative (APGCI), which allowed us to develop improved transportation systems for our Asia-Pacific gateway, and Transport Canada’s Regional Transportation Assessments, which give governments a better understanding of existing transportation systems. To demonstrate to trading partners such as the U.S. that we can provide reliable and secure trade, we must invest in the security and reliability of our trade and transportation infrastructure.

Not only would investment in trade infrastructure support our relationship with the United States, but it would also work to decrease our internal trade barriers, improving the flow of goods interprovincially. Further, improving trade infrastructure could spur increased investment for large-scale projects across the country, driving economic growth and innovation.

Prepare for CUSMA Negotiations 

In 2026, the parties involved in the Canada-United States-Mexico Agreement (CUSMA) can open the terms of the agreement for negotiation. Regardless of which candidate wins the election in November, it is likely CUSMA will be re-opened – especially given corporate and political pressure on the U.S. government to reconsider CUSMA rules relating to dairy market access, energy, agriculture, food policy, automotive rules-of-origin and digital trade have only increased since the agreement was first signed. The Republicans and Democrats are aligned on the fact that manufacturing should be drawn back inside the U.S. borders, and both seem to be pursuing a similar agenda of worker-centered trade policy. Given this, it will be of the utmost importance for governments in Canada to begin preparing for this renegotiation now. We are pleased to see the Government of Canada’s consultation on CUSMA, and urge continued consultation and engagement with the business community in the months and years leading into 2026.

The Government of Canada should use the upcoming CUSMA negotiations as an opportunity to strengthen our position as a strong trading partner. This includes trade irritants such as our commitment to increase our military spending to two per cent of our national gross domestic product by 2032, policies such as the Digital Services Tax Act, which some U.S. Members of Congress say disproportionately penalizes U.S. companies, the Online News Act, which again has faced criticism from the U.S. with concerns it may violate the terms of CUSMA, and the Online Streaming Act, which similarly may discriminate against U.S. companies and creators. These, among other possible sticking points for the U.S., should be examined by the Government of Canada to determine if risks associated with these pieces of legislation to our trading relationship with the United States can be mitigated.

Canadian governments – at all levels – must also work with industry to shore up our strategic leverage in light of the upcoming renegotiations. Engaging with sectors that may cause friction in CUSMA negotiations, such as automotive and critical minerals, dairy and supply management, and softwood lumber, is essential to determine their needs in a CUSMA renegotiation. Proactively demonstrating the value of Canadian goods in these sectors to the U.S., and attempting to assuage concerns over Canadian production having a negative impact on American businesses, will pay dividends during negotiations. Moreover, it will be important to capitalize on our strengths, develop trade infrastructure and create a competitive domestic policy environment to support our sectors that are of strategic value to the United States – including agriculture, energy, manufacturing, mining and critical minerals – to get their products to market. This will be key in demonstrating the value of trade with Canada to policymakers, government officials and business leaders south of the border.

Prioritize Competitiveness 

For the Canadian economy to succeed in relation to the United States, we must support a competitive business environment across sectors and sizes of firms. Canada’s population and economy is dwarfed by our southern neighbours – we are a country of 41 million people, with an export-driven economy and a tax structure that is on par with the U.S., despite their economy being over 10 times the size of ours. To drive growth across our exporting industries, we need governments to address competitiveness and productivity. The only way to compete with the United States is to have the most efficient, consistent and clear regulatory systems across sectors.

The continued punitive layering of burdensome regulatory policy, such as the recent changes to the Competition Act introduced in Bill C-59, the proposed Oil and Gas Emissions Cap, the draft Clean Electricity Regulations and the recent changes to the capital gains inclusion rate announced in Budget 2024, negatively impacts our competitiveness and drives away investment. Similarly, our tax system must be structured to be more competitive and more supportive of entrepreneurial risk-taking.

Canada as a nation has significant resources – both natural and human – that we need to leverage. To demonstrate our value to trade partners in the United States, we should be capitalizing on our existing strengths to increase our exports, driving growth across the economy. Businesses must be able to respond to the needs of our trade partners in the U.S., increasing our exports and making the most of our strategic leverage. To do this we need policymakers to ensure that competitiveness and productivity are top of mind, especially as it relates to regulatory burden and tax structure.

Highlight Alignment with U.S. Policy 

To work effectively with either Administration, federal, provincial and territorial governments must consider the broader policy goals of their U.S. counterparts. This is not to suggest that U.S. policy should dictate Canadian government agendas. However, ensuring American trade officials see their policy priorities supported by trade with Canadian firms will help showcase the value of Canada and America’s bilateral trade relationship.

For example, if Ms. Harris is successful in her election bid, it is safe to assume the United States will continue its drive to develop renewable energy production, expanding upon policies such as the U.S. Inflation Reduction Act. Federal and provincial governments in Canada should keep this in mind when undertaking trade discussions with a Harris administration, ensuring that Canada’s strong environmental and workers rights record is emphasized, showing alignment with the policy goals of a Harris administration. Reviewing historical priorities and finding alignments where feasible will allow future trade negotiators to see common values reflected in Canadian policy, ultimately smoothing over potential trade irritants.

Governments must also consider the policy goals of a potential Trump administration, which has promised to expand conventional energy production through further oil and gas exploration, production and processing. Governments must be prepared to respond to these broader domestic policy goals from both an alignment and competitiveness perspective, particularly in key sectors, such as energy and agriculture, ensuring Canadian trade offerings are viewed as aligned with U.S. priorities. Similarly, a Republican administration that values the security of energy supply and manufacturing supply chains will likely seek this in trade negotiations with Canada and Canadian firms.

Recommendations 

To advance Canada’s competitive advantage of accessing the United States economy, maintain the value of Canada’s exports to the U.S., and ensure investment and productivity are not stifled due to a shift in Canada-U.S. relations, we propose the following recommendations to Canadian governments:

• Take a ‘Team Canada’ approach to international relations with the United States, ensuring collaboration across federal, provincial and territorial and municipal governments is top of mind. Develop intergovernmental collaboration and strong communication with the U.S. federal government and state partners in key trading states to ensure Canadian businesses maintain their market access, and U.S. partners understand the value of Canada’s supply chains. Having strong allies at the state level proclaiming our trade significance in Washington is also advantageous.
• Improve key sectors’ access to markets through more robust supply chains and trade infrastructure. Federal, provincial and territorial governments must collaborate to define Canada’s national trade corridors and improve collection and utilization of trade and transportation infrastructure data to make informed investment decisions, targeting high-value projects that will contribute to Canada’s infrastructure and supply chain security. Once defined, we should adopt already established international best practices from other jurisdictions and build upon Canada’s existing trade infrastructure.
• Ensure Canadian policies, particularly those related to energy development, environmental regulation and worker protections, can support U.S. domestic policy for either administration while maintaining Canada’s own policy priorities. Ensuring our governments can be nimble in responding to U.S. priorities will be key to supporting Canada’s trade narrative.
• Consider the impacts of regulatory burdens and restrictive tax structures on Canadian competitiveness. Ensure Canada is well positioned to be a competitive jurisdiction for Canadian businesses to grow, and a destination for American businesses to scale and investment to be deployed.
• Resolve domestic labour disruptions in a timely and equitable manner, reducing the impact on businesses and trade infrastructure. Disruptions such as the recent lockout and strike action for Class 1 rail operators, disruptions in the airline industry, and last summer’s planned port strike damage our global reputation as a reliable trading partner and could negatively impact the impending CUSMA negotiations. Consider both Democratic and Republican commitments to support worker protections when resolving labour disruptions, ensuring equitable agreements are reached.
• Pre-emptively work to address potential trade irritants in light of the potential 2026 CUSMA renegotiation. Including our NATO commitment to reach two per cent of GDP spending on defensive capabilities, and potential issues surrounding the Digital Services Tax Act, Online News Act and the Online Streaming Act. Additionally, work with stakeholders in sectors that have historically been front-of-mind in international trade negotiations to mitigate risks for businesses.

ABOUT THE CALGARY CHAMBER OF COMMERCE  

The Calgary Chamber exists to help businesses reach their potential. As the convenor and catalyst for a vibrant, inclusive and prosperous business community, the Chamber works to build strength and resilience among its members and position Calgary as a magnet for talent, diversification and opportunity. As an independent, non-profit, non-partisan organization founded in 1891, we build on our history to serve and advocate for businesses of all sizes, in all sectors across the city.