Whoever wins Monday’s election will have an enormous task of rebuilding the Canadian economy after years of stagnation — and in the face of an escalating trade war with the United States.
They’ll have their work cut out for them. But CEOs and industry leaders say these twin crises offer what many industry leaders are calling a generational opportunity. In interviews and speeches through this campaign, they’ve raised concerns, flagged opportunities and charted out what they think politicians should do once the campaign is over.
Party leaders agree on many (but not all) ways to get the economy off the mat. Here are four steps either party in the running to form government could take to spur much-needed economic growth.
Canadian energy companies say the threats from the U.S. have highlighted the need to build out this country’s energy infrastructure.
“Canada has a time-bound opportunity to strengthen our economic sovereignty, build our economy and re-establish our global position,” said François Poirier, CEO and president of Calgary-based TC Energy. “We can do this by delivering energy security and enabling emission reductions for our allies through exporting Canadian liquefied natural gas to replace higher emitting coal.”
In an open letter released at the beginning of the campaign, the CEOs of some of the biggest energy companies in the country laid out what they feel needs to be done to boost Canada’s economy through energy investments.
“The federal government’s Impact Assessment Act and West Coast tanker ban are impeding development and need to be overhauled and simplified. Regulatory processes need to be streamlined, and decisions need to withstand judicial challenges,” read the open letter.
That’s a key nuance. The energy CEOs are calling for an overhaul of the legislation instead of scrapping it completely and starting from scratch.
To that end, both the Conservative and Liberal party leaders have vowed to speed up the approvals process.
The Conservatives have vowed to build a “national energy corridor” and create a rapid resource project office to get projects approved within a year. The Liberals have vowed to create a major federal project office mandated to make decisions on projects within two years
From labelling requirements to professional licensing standards, Canada’s notorious trade barriers make it difficult or even impossible for Canadian companies to do business with each other across provinces. Still, they’ve withstood the pressure to change in the past. Each time, the instinct to protect local industries has outweighed the national boost that would come with removing barriers.
But in the face of potentially economy-ending tariffs, there’s a growing chorus of calls to make real change to the practice.
One analyst called this at once the dumbest and easiest problem to solve.
“It’s easy because it should be the first thing [the new prime minister does]. It’s dumb because it shouldn’t exist in the first place,” Richard Dias, macro strategist at IceCap Asset Management.
In a 2019 research paper for the International Monetary Fund, Trevor Tombe, a University of Calgary economist, wrote that removing non-geographic trade barriers could dramatically increase cross-Canada trade volumes by as much as 15 percentage points.
That report found that completely removing all internal trade barriers would see GDP per capita rise by 3.8 per cent nationally. Smaller regions would see some of the biggest gains: In a province like P.E.I., real GDP could increase by as much as 16 per cent.
In February, the federal government announced it would remove 20 federal exceptions in the Canadian Free Trade Agreement, reducing them from 39 to 19.
Both the Liberal and Conservative party platforms outline a plan to meet NATO’s defence spending target of two per cent of GDP. Both promise to fix military recruitment, purchase new equipment and upgrade bases in the Arctic.
Reaching that two per cent target would mean hundreds of billions of dollars in spending.
“Depending on what you spend the dollars on, one dollar of spending on defence in Canada will get you about two jobs and about two dollars in total direct indirect and induced economic activity,” said David Perry, president of the Canadian Global Affairs Institute, an international affairs think-tank based in Calgary and Ottawa.
Key Canadian companies are internationally renowned as manufacturers of military equipment, like armoured vehicles made in London, Ont., or drones built in Quebec and Alberta.
But even contracts for products that Canada has never built — like submarines — will have a knock-on effect on investment here.
Under an offset program called the Industrial Technological Benefits Policy, any company that wins a procurement contract is required to make an equivalent investment in a Canadian company and in the Canadian economy.
“So even if the money was going to the United States, the American company that wins it has to agree contractually to spend the equivalent value of that contract in the Canadian economy,” says Perry.
The former CEO of Google spoke at the TED2025 conference in Vancouver earlier this month about the growing economic opportunities around artificial intelligence. Eric Schmidt says there is one enormous obstacle to that opportunity.
“There’s a real limit on energy,” he said. “I’ll give you an example. There’s one calculation — and I testified on this this week in Congress — that we need another 90 gigawatts of power in America.”
That’s a lot of energy. AI data centres suck up power at a nearly unfathomable rate. However, Schmidt says, there’s one obvious answer.
“My answer, by the way, is think Canada, right? Nice people, full of hydroelectric power.”
The sector is already very well established in this country. Two of the biggest names in the industry — Geoffrey Hinton and Yoshua Bengio — are seen as pioneers in the field and are leading research at Canadian universities.
The federal government made a $2.4-billion investment in AI last year, with much of that earmarked for a fund meant to increase access to computing capabilities and technical infrastructure.
The Liberal platform pledges to build on that. The Conservatives’ platform promises to scale back AI investment by nearly $2.3 billion over the next four years, though it didn’t offer further details. Previously, the party has said its plan was to “unleash hundreds of billions of dollars of investment” in areas including data centres.
There are plenty more roads whoever wins the election can take to rebuild the economy.
The question is whether the next prime minister will make good on their promises. In a lot of ways, winning the election is the easy part. Actually doing the work and seeing through priorities is difficult in the best of times. And with a weak economy, facing down the potential devastation of a trade war, these are decidedly not the best of times.
