Canada budget vows to reduce reliance on US
AgenciesCanada unveiled a budget on Thursday that calls for “economic independence” and says that while reducing its reliance on the United States will take time, “the shift is und...
Canada unveiled its budget on Thursday, emphasizing a commitment to "economic independence" and acknowledging that reducing its reliance on the United States is a gradual process. Prime Minister Mark Carney presented his second budget since taking office last year, just two days after President Donald Trump's party suffered a major defeat in the midterm elections. Carney's budget asserts that Canada cannot continue to depend on the US market and highlights the need for diversification.
Titled "Masters of our Destiny," the budget outlines plans for Canada's first-ever sovereign wealth fund, the CAN$25 billion ($18.3 billion) Canada Strong Fund, which will invest in major national projects. The government hopes that a stake in these projects will attract private capital. The budget marks a decisive break from the previous administration, as Finance Minister Francois-Philippe Champagne takes a different approach compared to his Liberal predecessor, Justin Trudeau.
Carney inherited an economy plagued by weak productivity growth and excessive dependence on the United States. He acknowledged that diversification will take time but emphasized that the shift is already underway. At a major investment summit in September, Carney introduced the "Productivity Mega Deduction," a tax incentive aimed at making Canada a more attractive investment destination compared to the United States. The incentive allows businesses to deduct costs of new investments at a lower tax rate than in the US.
The budget also addresses the economic impact of Trump's tariffs, which have affected key sectors such as automaking, steel, aluminum, and lumber. Approximately CAN$44 billion has been announced to support businesses and workers impacted by tariffs, with CAN$10 billion allocated to workers and CAN$20.6 billion to help businesses adapt to the tariff disruptions.
Conservative leader Pierre Poilievre criticized the budget, accusing the Liberals of presenting a "credit card budget" that ordinary Canadians will ultimately have to pay for.
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