Blog Post

What the American Election Means for Canada’s Construction Industry

With the recent election in the United States, uncertainty is rampant as many are pondering the decisions Donald Trump will make as they have the potential to affect the world economy. In Canada, we are certain to be affected by any changes made to current or future policies.

Trump has promised to cancel or renegotiate the North American Free Trade Agreement (NAFTA). If he changes the existing agreement, it will create change for Canada as we currently send three-quarters of our exports south. This could adversely disrupt existing partnerships involving businesses included in NAFTA. Although Trump may have the power to scrap NAFTA, Congress would have to re-establish tariffs as well as the Canada-US agreement that pre-dated NAFTA. Changing policies between Canada and the US would be complicated. It appears that Trump’s main issue may be with Mexico where he has threatened to impose taxes on American companies that establish cheap labour plants there. He does not appear to have any direct issues with Canada. The indirect way that Canada may be affected is if Trump confronts China over trade which would affect our economy and/or the dollar.

Climate Change, Oil and Gas
Justin Trudeau has pushed for a solution to tackle climate change by levying a price on carbon which will assist Canada in limiting greenhouse gas (GHG) emissions. An agreement that has already been established between Trudeau and Obama regarding these emissions could be struck down as Trump has stated that the climate change deal is “bad for US business”. With Trump’s goal of investment into traditional energy infrastructure, developing renewable energy technologies may be disregarded.

The traditional energy perspective gives renewed opportunity for energy projects that couldn’t pass under Obama. The Keystone XL pipeline project and other similar pipeline projects could be approved which would give Canadian oil companies a better price on their output with more direct access to international markets.

Immigration and Skilled Labour Migration
Donald Trump has indicated that he intends to deport millions of illegal immigrants. In Canada, our government is accommodating to immigrants. The benefit to Canadian businesses is that Canada would have access to skilled immigrant workers who have been displaced or are no longer interested in living in the United States. The potential drawback could be that many immigrant employees may have to be trained to ensure they have the same skills as current employees.

Infrastructure Investment
If Donald Trump follows through with campaign promises, we could see significant money being spent on infrastructure. He has stated that he is planning to spend money on stimulus programs for highways, bridges, and tunnels. Canada could benefit from this if the two governments focus in a similar manner on building the infrastructure capacity and framework of the two nations. Whether or not this will be open to Canadian businesses and firms remains to be seen. It could adversely affect Canada however if NAFTA is renegotiated or in question; the policy in the US may be to Buy American and Canada might be on the outside looking in.

With so many possibilities, it will be of interest to all Canadians to see what decisions Donald Trump makes as President. During his campaign, he was vocal about changes he would implement if he was elected. Only time will reveal what claims he intends to follow through with and how he proposes to create change.

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