Polievre’s Plan to Expand Canadian Trade
With the roller coaster of US Trade tariffs it is time to take a serious look at reducing interprovincial trade barriers.
Canada faces significant trade barriers between provinces, limiting economic growth. Conservative leader Pierre Polievre proposed a plan to reduce barriers last week.
The Conservative plan aims to increase internal trade, reducing reliance on the U.S. and potentially boosting GDP by over $200 billion annually, or $5,100 per person.
The proposed strategy includes bringing together provincial leaders within 30 days of forming a government to eliminate unnecessary trade exemptions. One major focus is streamlining trucking regulations, ensuring smoother east-west trade, which could increase GDP by $1.6 billion.
A key initiative is the introduction of a Blue Seal Professional Licensing Standard. This system would allow professionals such as doctors, nurses, and engineers to work across all provinces without additional certification hurdles.
From an agriculture perspective, it would allow agriculture service technicians to easily move from province to province. It would also help skilled workers trained abroad integrate into the Canadian workforce faster.
To encourage cooperation, a Free Trade Bonus would be offered to provinces. As trade barriers are removed, GDP and tax revenues would rise. The government plans to return this increased revenue to provinces, allowing them to invest in essential services like healthcare and education. This initiative would be funded through economic growth rather than increasing the deficit.
The urgency of internal trade reform is evident. Trade within Canada faces more restrictions than trade with other countries. In 2023, international trade made up 66% of GDP, while interprovincial trade accounted for just 36%.
Despite the Canada Free Trade Agreement, numerous exemptions still hinder progress. A 2023 report identified 245 exemptions across provinces, creating unnecessary complications.
Economists estimate that removing these barriers could boost the economy by up to 7.9 percent, adding billions to national revenue. While Canada will remain connected to the global market, improving internal trade will strengthen its economy and reduce dependence on external forces.
This initiative represents a shift towards economic self-reliance, ensuring Canada benefits fully from its resources, businesses, and workforce. By prioritizing internal trade, the country can foster growth, create jobs, and build a more resilient economy.
There is no doubt that if barriers were removed, some companies would benefit and some would be hurt, but those are not the only barriers to trying to make interprovincial trade work better.
The barriers to this type of internal trade are varied. Provincial revenues are generated from businesses, provincial politicians may not be eager to make those changes if they believe they will hurt their government revenue.
It is also a power issue – the provinces will not be eager to give up their regulatory authority in many areas.
There is also, of course, the government employees who may be resistant to change out of self-preservation.
Of course, the court of public opinion may also be hard to convince, let’s not pretend the provinces see eye to eye on many things.
Whether or not we see more US trade tariffs come into effect in the coming weeks, it just seems to make sense that we would want to strengthen the Canadian economy by removing these barriers. But is there a will to push this forward?