The business leaders representing eight of Canada’s largest urban economies say rejecting a trade agreement that would damage Canada’s long-term interests was the responsible choice but warn that tariffs will bring real pressure for families, businesses and workers.
The Canadian Global Cities Council (CGCC) is backing the federal government’s decision to reject a trade agreement it says would directly harm Canada’s long-term economic interests, while acknowledging that the decision will come with real costs for Canadian businesses, workers and families. In a statement released August 26, the CGCC said choosing no deal over what it described as a “deeply damaging deal” required resolve and was the responsible course of action.
The CGCC brings together the chief executives of eight of Canada’s largest urban chambers of commerce and boards of trade. Its members include the Greater Vancouver Board of Trade, Calgary Chamber of Commerce, Toronto Region Board of Trade, Edmonton Chamber of Commerce, Winnipeg Chamber of Commerce, Chamber of Commerce of Metropolitan Montreal, Halifax Chamber of Commerce and Ottawa Board of Trade. Together, the economic regions represented by its members account for 52 percent of Canada’s GDP and more than half of the country’s population. That gives the council a direct line to businesses dealing with the effects of the trade dispute.
In its statement, the CGCC says that accepting an inadequate agreement now could impose deeper and longer-lasting costs on Canadians than the immediate pressure created by the current tariff dispute. At the same time, the council makes clear that it does not underestimate those immediate costs. “We do not minimize the impact of these tariffs,” the CGCC said.
The organization warned that Canadian families will face higher costs, businesses will confront disrupted supply chains, and workers will feel the pressure directly.
For Canada’s major cities, the concern is particularly significant because urban economies are at the centre of the country’s manufacturing, logistics, business services and trade networks. The CGCC points to Canada’s nearly US$880 billion annual trading relationship with the United States as an indication of the scale of the economic relationship now under pressure.
The council is not arguing that Canada should walk away from a trade agreement with the United States. It says Canada must remain focused on what it calls “a strong and durable trade agreement that serves Canadians from coast to coast to coast.”
But the CGCC is also making the case that reaching an agreement simply to end the current dispute may not be enough. If the terms leave Canada in a weaker economic position for years to come, short term relief could come at a much greater long term cost.
For businesses, however, that calculation does little to ease the pressure they are facing now. Companies involved in cross-border trade are dealing with uncertainty, changing costs and potential supply chain disruptions. And the impact does not stop with companies that export directly to the United States. Changes in the cost or availability of goods can affect other businesses along the supply chain and eventually reach consumers.
The CGCC’s intervention reflects the important role major urban economies play in Canada’s overall economic health. Its members are hearing directly from businesses about the pressures they are facing, including higher costs, supply chain disruptions and uncertainty about what comes next. Those concerns are particularly relevant in Ottawa. The capital has a diverse business community that includes technology, telecommunications, professional services and research, while also being home to the federal government and many of the institutions involved in Canada’s economic and trade policy.
The Ottawa Board of Trade is one of the eight organizations represented on the CGCC, giving Ottawa a direct voice in the council’s discussions about the challenges facing Canadian businesses and the broader economy.
The most practical part of the CGCC’s statement is its focus on what Canada can control. The council is calling for the removal of remaining internal trade barriers, stronger trade enabling infrastructure, greater export diversification and policies that encourage investment, productivity and growth. Canada has little influence over U.S. trade policy, but it can take steps to make its own economy more competitive and less vulnerable to disruptions in a single market.
Reducing barriers between provinces would make it easier for Canadian businesses to expand domestically, while better infrastructure could improve the movement of goods and strengthen access to international markets. Greater export diversification would give companies more options, while increased investment and productivity would strengthen Canada’s competitive position. For the CGCC, these are not simply measures for getting through the current dispute. They are part of a broader effort to build a more competitive and resilient Canadian economy.
Diversifying Canada’s trade is easier to discuss than to accomplish. The United States remains Canada’s largest trading partner, and decades of economic integration have created highly interconnected supply chains and commercial relationships.
The goal, therefore, is not necessarily to replace the American market, but to give Canadian businesses more alternatives.
The federal government has also emphasized the importance of opening new markets. In a statement following the breakdown of the latest Canada-United States trade negotiations, Prime Minister Mark Carney said Canada is advancing major infrastructure projects while working to unlock new export markets, noting that Canada’s existing free trade agreements provide preferential access to 1.5 billion consumers.
The CGCC’s call for diversification fits into that broader economic strategy.
The council also sees a role for its members in making sure the concerns of businesses are heard. “As chambers working directly with businesses across sectors, CGCC members are in constant dialogue with companies and governments,” the statement says.
The council says it will continue to bring those concerns to governments, support businesses and workers facing immediate pressures, and push for reforms that strengthen Canada’s competitiveness and economic resilience. That ground-level perspective will be important if the trade dispute continues. Businesses are the ones making decisions about investment, hiring, production and expansion, and their experience will provide a clearer picture of the economic impact than the headlines alone.
The CGCC is also calling for a united Canadian position as the trade dispute continues. “Canada’s leverage depends on one clear, coordinated position,” the council says, urging business, civic and political leaders to publicly and consistently support that approach.
At the same time, the council is pointing to work that needs to happen at home. Removing internal trade barriers, improving infrastructure, opening new export markets and encouraging investment and productivity would strengthen Canada’s position regardless of how the current negotiations unfold. Canada cannot control U.S. trade policy, but it can decide how competitive and resilient its own economy will be. For businesses, the immediate pressures remain real. Tariffs, supply chain disruptions and uncertainty can affect costs, investment and hiring. But the CGCC’s position is that accepting an agreement that compromises Canada’s long-term interests could ultimately carry a greater cost.
The CGCC is not calling for Canada to abandon its trading relationship with the United States. Its objective remains a strong and durable agreement that serves Canadians across the country. The question is what Canada does while pursuing it. For Ottawa and communities across the country, the coming months will test both the country’s negotiating position and its ability to strengthen the economy at home. The CGCC is urging Canada to hold firm on its long-term interests while addressing the domestic barriers that can make Canadian businesses less competitive. The immediate economic pressure may be difficult for businesses and households, but the council’s argument is that Canada should use this period to address weaknesses that have been identified for years.
The goal, ultimately, is not simply to get through the current trade dispute. It is to emerge with a stronger Canadian economy and a durable trade relationship with the United States that serves Canadians from coast to coast to coast.
Photo: iStock
