Prime Minister Justin Trudeau has outlined his economic vision related to possible future tariffs, saying it’s time for Canada to have “genuine” interprovincial free trade.
Speaking at the Canada-U.S. Economic Summit in Toronto on Feb. 7, Trudeau said that while Canada will explore ways to prevent U.S. tariffs from being imposed after the 30-day reprieve, the country must also focus on building long-term economic resiliency.
“It’s about time we had genuine free trade within Canada. There are still far too many barriers to domestic trade across the country,” he said, citing bureaucratic challenges that lead to ongoing differences across provinces, such as in recognizing teaching certificates, labour mobility, and tire requirements.
There are differing regulations between provinces across a variety of sectors such as alcohol, energy, and professional licensing, which critics say hinder the movement of goods and services. Flattening these barriers could increase Canada’s economy by up to $200 billion annually, according to a 2024 report by the Canadian Federation of Independent Business.
Internal Trade Minister Anita Anand was recently asked by reporters whether interprovincial trade barriers could be eliminated within the next 30 days. “The short answer to your question is, yes,” Anand said during the Feb. 5 press conference at the Port of Halifax.
The minister reiterated the pledge in a Feb. 7 social media post, saying Ottawa is “working with all provinces and territories to eliminate internal trade barriers and ensure greater labour mobility across the country.”
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Before Canada and the United States reached a temporary truce on tariffs, Conservative Leader Pierre Poilievre had called for the elimination of interprovincial trade barriers, among other measures, to strengthen domestic trade.
“We need to knock down interprovincial trade barriers to have true free trade across our country. We are in this state because we trade twice as much to the Americans as we sell to ourselves,” he said during a Feb. 2 press conference.
Diversify Exports
The summit, announced Feb. 5, comes as U.S. President Donald Trump delayed the imposition of tariffs on Canada, which were initially set to take effect on Feb. 4. One key focus of the event is to explore ways to diversify export markets in light of the tariff threats, the Prime Minister’s Office (PMO) said in a press release.
“We have tremendous opportunity to go where a big centre of gravity, the economy, is being pulled, but it’s not enough to just sign a trade deal. We have to actually follow up on them, with trade missions, with actual investments, with partnerships,” Trudeau said.
Trudeau also said the government will take a more strategic approach to trade with the United States, part of a three-pronged tariff response he proposed at the summit. He also said trade with the U.S. will remain crucial to Canada’s economy.
‘Fentanyl Tariffs’
Trudeau described the focus on increasing Canada’s economic resiliency as the “strategic” side of the response to the U.S. tariffs. He also emphasized a “tactical” approach to addressing the fentanyl crisis, which is a key reason cited by Trump for imposing the tariffs. The president has repeatedly raised concerns over the inflow of fentanyl, other illicit drugs, and illegal migrants entering the United States from Canada.
“On the tactical side, we need to talk about tariffs, the 30-day extension been given on the border, or fentanyl tariffs, is something we need to use,” Trudeau said. “We need to be very deliberate about how we continue to engage closely with the United States to make the case and demonstrate that Canada is responsible for a tiny part of the North American fentanyl problem, but that we are also bitterly touched by this tragedy.”
U.S. border agents intercepted a relatively small amount of fentanyl from Canada last year, 43 pounds, compared to about 21,100 pounds coming from Mexico. There is, however, growing involvement by Canada-based criminal organizations in the fentanyl trade, according to the Criminal Intelligence Service Canada.
Alberta Premier Danielle Smith has criticized the argument that the amount of fentanyl flowing from Canada to the United States is merely a fraction of that from Mexico, saying Canada needs to take a more serious approach to address the issue.
“We should stop making excuses, stop saying, ‘Yeah, but we’re not as bad as the other guys.’ We should just say, ‘Yes, we agree, and we’re going to take care of our part of the issue so you don’t have to worry about us anymore,’” she said in a Feb. 4 interview with CTV News.
The Canadian Press contributed to this report.
