Prime Minister Mark Carney’s government is using its second budget to shift Canada toward a more diversified trade model, as U.S. tariffs pressure key industries and Ottawa seeks greater economic resilience.
Finance Minister Francois-Philippe Champagne said the plan would encourage commerce within Canada and diversify trade relationships. Carney named the budget “Masters of our Destiny,” AFP reported.
Champagne said the budget would support workers affected by U.S. tariffs in the auto and steel industries. AFP reported that funding is expected for energy infrastructure and critical-mineral mining projects, which Carney has identified as important to Canada’s economic sovereignty.
Carney has said Ottawa should plan for a lasting change in its relationship with Washington and seek wider trade links instead of expecting the earlier tariff-free arrangement to return. Canada’s minister responsible for U.S. trade, Dominic LeBlanc, said tariff negotiations would take place with President Donald Trump’s White House, not Congress. He said Canada’s focus also includes diversifying trade.
Democrats are due to take control of both chambers of Congress in 2027 after Republicans lost the midterm elections. Democratic Rep. Jamie Raskin told CBC on Nov. 4 that his party would seek to end the tariffs and repair ties with Canada.
AFP reported that the federal deficit is expected to be below C$78.3 billion, the figure projected in Carney’s first budget in 2025. Before the new budget, Canada’s Parliamentary Budget Office forecast 0.9% economic growth in 2026, as EconoTimes reported in its coverage of the growth estimate.
Canada’s budget bills are confidence votes. AFP reported that Carney’s government needed opposition support or abstentions to survive its 2025 budget, but the Liberals have since secured a parliamentary majority. Genevieve Tellier, a political scientist at the University of Ottawa, said implementation would depend in part on whether tariffs cause further job losses. Recent positive remarks from Carney and Trump about a possible trade deal followed an earlier round of optimism before talks broke down in August, AFP reported. Champagne is due to present the budget to Parliament on Nov. 5.
