Canadian firms expand global trade amid U.S. tariff war, experts warn of limits
Canadian companies are ramping up exports to global partners in response to U.S. President Donald Trump’s tariff hikes, but experts caution that the U.S. remains irreplaceable in Canada's trade landscape.
New data from Statistics Canada reveals exports to the U.S., Canada’s top trading partner, fell from 78% to 68% of total exports between May 2024 and May 2025, particularly in key sectors like autos, steel, and aluminum, News.Az reports, citing Reuters.
In contrast, exports surged to Europe, the UK, Australia, and Asia. Notably, gold exports to the UK rose 473% in value year-over-year, helping make Britain Canada’s second-largest export market, overtaking China.
“This is a good thing for Canadian diversification,” said Stuart Bergman, chief economist at Export Development Canada. “But we’re not trying to replace our U.S. trade, that would be crazy.”
Despite diversification gains, with increased shipments to Germany, Japan, Singapore, Brazil, and others, no single market comes close to rivaling U.S. demand.
Prime Minister Mark Carney, elected in April, has vowed to stand firm against U.S. pressure and expand trade ties globally. A potential deal with Trump is expected by July 21. If talks fail, Canada may impose new counter-tariffs.
Still, experts like Mike Chisholm, an independent trade consultant, warn that deeply integrated North American supply chains mean the U.S. will remain Canada’s primary partner.
“No matter how much we diversify, our economic roots with the U.S. run deep,” he said.
Canada’s exports to the U.S. dropped 15% in May to C$43.9 billion, while exports to the rest of the world rose 42%, a C$5.7 billion increase, not enough to fully offset the U.S. shortfall.
With tariffs tightening and global uncertainty rising, Canadian businesses are navigating new markets, but the road to full trade independence remains long.
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