Canada is accelerating efforts to remove barriers to trade between its provinces and territories, particularly after the breakdown of trade negotiations with the United States. However, experts warn that changing long-established regulations will require considerable time and coordination.
Progress has already been made in some areas. For example, nine provinces recently agreed to permit direct-to-consumer alcohol sales across provincial borders. However, the process still involves additional fees, registrations and regulations in some provinces, creating difficulties for businesses.
Wine producers have criticized these requirements, arguing that companies should not have to deal with separate registrations or multiple wholesale markups simply to sell their products elsewhere in Canada. They say such bureaucracy limits the potential of a unified Canadian market.
The economic benefits of removing these restrictions could be significant. The International Monetary Fund estimates that eliminating internal trade barriers could increase Canada’s real GDP by more than 7%, equivalent to around $210 billion, over the long term. CIBC has offered a more cautious estimate of about a 1% GDP increase but still considers reducing the barriers worthwhile.
Federal and provincial finance ministers are currently working together to strengthen the idea of “one Canadian economy.” Internal Trade Minister Dominic LeBlanc said that although progress has been achieved, more action is necessary as US trade policies continue to change.
Key priorities include creating freer movement of services across provinces, simplifying approval procedures for prefabricated homes and construction materials, and making it easier to sell food products throughout Canada.
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