What could Trump's victory mean for Canada?

The ascendancy of Donald J. Trump to the U.S. presidency sent huge reverberations throughout the world, but nowhere will his election be felt more than here in Canada.

President-elect Donald Trump's policies could affect trade, boost Canada's oilpatch

Republican presidential nominee Donald Trump arrives for his election night rally at in New York City. Trump's proposed policies could have consequences for Canada's economy. (Andrew Kelly/Reuters)

The ascendancy of Donald J. Trump to the U.S. presidency sent reverberations throughout the world, but nowhere will his election be felt more, outside of America itself, than here in Canada.

There are perhaps no two countries more intertwined, through trade, regulations, language and culture. The United States is Canada's largest market for goods and services — it's not even close — with more than $450 billion flowing across the border each year.

Trump pitched policies to voters that could be construed as concerning for policymakers north of the border, but some of his proposals could also be a boon for the country's biggest industries, namely oil and gas.

Canadian Prime Minister Justin Trudeau vowed Wednesday to work with U.S. president-elect Donald Trump 'in a positive way.' (Sean Kilpatrick/Canadian Press)

He sent a clear message during his victory speech early Wednesday morning that, while he might wall off the country from Mexico, he's not opposed to positive relations with the international community.

"We will get along with all other nations willing to get along with us. We'll have great relationships, great, great relationships," Trump said.

"I want to tell the world community that while we will always put America's interest first, we will deal fairly with everyone, with everyone, all people and all other nations. We will seek common ground, not hostility, partnership, not conflict."

Canadian Prime Minister Justin Trudeau, for his part, said he was looking "forward to working very closely with president-elect Trump, his administration, and with the United States Congress in the years ahead."

Here's a look at some of the impact Trump's proposed policies could have on Canada:


Analysts peg part of Trump's decisive victory to his success in the "rust belt states" of Pennsylvania, Michigan and Wisconsin, states where the Democratic Party has long relied on union members to fall faithfully in line.

But the billionaire mogul's departure from his party's traditional pro-trade orthodoxy secured him votes from Americans who have grown increasingly skeptical of the promised benefits of free trade.

Trump took aim at NAFTA, in particular, assailing the deal as bad for manufacturing and American jobs.

He pointed to thousands of factories closed since former president Bill Clinton signed the deal, some because of the push to move jobs offshore, others because of technological innovation.

Trump said during the campaign he will accept nothing less than a new deal. 

"NAFTA is the worst trade deal maybe ever signed anywhere, but certainly ever signed in this country," he said during the first election debate.

"I'm going tell our NAFTA partners that I intend to immediately renegotiate the terms of that agreement to get a better deal for our workers. And I don't mean just a little bit better. I mean a lot better," he later added on the campaign trail while stumping in Pennsylvania. "It's a disaster."

A spokesperson for Chrystia Freeland, Canada's international trade minister, said roughly 2.5 million Canadian jobs are dependent on trade with the U.S., while 23 per cent (or $449.9 billion) of our GDP is derived from exports of goods and services to the U.S. alone.

An astounding 72 per cent of Canada's exports of goods and services go to the U.S.

Ripping up NAFTA is relatively simple, as a member country can withdraw from the agreement six months after it provides written notice of withdrawal.

But some experts, including Scott Sinclair, a director with the Canadian Centre for Policy Alternatives, think Trump's anti-trade stance will face serious headwinds.

Most of Canada's free trade with the United States is "locked in through World Trade Organization rules," Sinclair told CBC News this month. "The trade impacts may not be as dire as some people predicted, and actually I would be more worried about Donald Trump's policies around climate change and deregulation."

Mexican President Enrique Pena Nieto, left, shakes hands with U.S. President Barack Obama, centre, as Canadian Prime Minister Justin Trudeau looks on at the conclusion of a joint news conference at the North American Leaders Summit in Ottawa. Trump has vowed to open NAFTA. (Fred Chartrand/Canadian Press)

Climate plan, oil and gas

Trudeau has pushed hard for a solution to tackle climate change, promising to levy a national price on carbon to help Canada meet greenhouse gas (GHG) emissions reduction targets set out in the 2015 UN Paris agreement on climate change that came into force last week.

Trudeau has sought to present himself as a climate champion — even while approving major energy infrastructure projects — and has already spent considerable political capital on a climate plan with the provinces so the country can do its part to keep warming at 2 C or less.

Now, the entire UN deal could be in peril, as Trump has vowed to back out of the agreement and reverse President Barack Obama's ambitious environmental agenda.

The climate change deal is "bad for U.S. business," Trump has said, adding the pact allows "foreign bureaucrats control over how much energy we use."

He's a climate change skeptic who at one point branded global warming a "Chinese hoax," and has said the entire Environmental Protection Agency (EPA) could be done away with, including its "job-killing" regulations.

One of the first things to go could be an agreement struck by Trudeau and Obama, during the Canadian prime minister's official state visit in March, to lower methane emissions from the oil and gas sector. The EPA was tasked with drawing up regulations to reduce emissions by 40 to 45 per cent below 2012 levels by 2025.

And yet there could be an economic windfall for Canada's oilpatch, which has been hit hard by low oil prices.

TransCanada's proposed Keystone XL pipeline to the Gulf Coast, denied approval by Obama for years despite intense lobbying efforts by the former Harper government, could now get the green light.

The project promises Canadian oil companies a better price on their output with more direct access to international markets.

Trump has said TransCanada should certainly pitch its pipeline again — approval would likely sail through the Republican House, which has long pushed for the project — but he also wants the U.S. to benefit from its construction and has said the U.S. should get a share of the "profits."

NATO, defence policy

Trump is not a fan of NATO, the military alliance created at the height of the Cold War to protect North America and its European allies against Russian aggression.

At the core of his criticism is that the United States foots the bill for far too much of the alliance's defence capacity, and other member nations — including Canada — are "freeloaders" for failing to contribute their fair share of domestic military spending.

Trump has said that if NATO allies don't meet its spending targets — two per cent of GDP on defence — they should get out of the alliance and defend themselves against security threats without relying on America.

"The countries we are defending must pay for the cost of this defence, and if not, the U.S. must be prepared to let these countries defend themselves. We have no choice," he said.

Canada signed on to meeting that target, but that promise looks disingenuous in retrospect. Canada's spending comes in at just one per cent of GDP, or roughly $20 billion a year, a figure many argue is too low to sustain a fine fighting force.

In the short term, Canada is moving no closer to meeting its goal. The 2016 budget deferred some $3.7 billion in spending for capital projects by five years. The Conservative government under Stephen Harper also let billions in planned military spending lapse.

Canadian Forces will also soon deploy to Latvia, for a NATO mission, to stand against Russian encroachment in the Baltic states. That mission could now be up in the air as well.

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