{"id":859218,"date":"2026-08-15T16:48:10","date_gmt":"2026-08-15T16:48:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/859218\/"},"modified":"2026-08-15T16:48:10","modified_gmt":"2026-08-15T16:48:10","slug":"through-the-fog-of-the-trade-war-canadian-business-investment-is-stirring","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/859218\/","title":{"rendered":"Through the fog of the trade war, Canadian business investment is stirring"},"content":{"rendered":"

Long before Donald Trump<\/a> started sticking it to us, Canada has wrestled with a stubborn investment problem.<\/p>\n

After a splendid 20th century for the Canadian economy, the 21st has not been nearly as prosperous, largely because Canadian companies have dramatically underspent their American peers.<\/p>\n

And then came Trump 2.0. Doubly hostile to free trade and determined to make Canada pay, his agenda was all the more reason for Canadian industry to double down on its austere sensibilities.<\/p>\n

So, it\u2019s a big deal that we\u2019re now seeing signs of a turnaround.<\/p>\n

Investment intentions by domestic businesses have risen to their highest level since Mr. Trump returned to office. Meanwhile, import volumes of machinery and equipment recently hit a decade high. Same goes for imports of computer equipment, which jumped by nearly 90 per cent in the month of June alone \u2013 possibly a sign that investment in artificial intelligence<\/a> is starting to gain traction.<\/p>\n

Just maybe this is the beginning of the end of Canada\u2019s investment drought.<\/p>\n

It is \u201cpossible that businesses are beginning to feel the effects of the federal government\u2019s investment-stimulating efforts,\u201d said Jocelyn Paquet, a senior economist at National Bank of Canada, in a recent note.<\/p>\n<\/p>\n

At the heart of those efforts are the infrastructure and defence projects that aim to heavily favour local manufacturing by awarding contracts to domestic companies.<\/p>\n

Many Canadians have been anxious to see tangible results. In April, after one year of Mark Carney\u2019s<\/a> leadership, the national mood seemed to be that the Prime Minister\u2019s grace period was running out. The Canada Strong plan needed more momentum.<\/p>\n

It\u2019s a very tall order. How to resurrect Canadian investment in an investment-hostile climate?<\/p>\n

Much of the appeal of Canada as an investment destination lies in its proximity and access to the U.S. market. Mr. Trump knows this and means to exploit it for maximum leverage. Scaring investors away from trading partners is very much part of the Trump playbook.<\/p>\n

Sadly, it works. Since 2016, when Mr. Trump first won the presidency, there has been virtually no growth in employment in Canadian industries dependent on U.S. demand, according to Statistics Canada.<\/p>\n

Meanwhile, we\u2019ve done little to help ourselves. Internal trade barriers, excessive regulation, some loss of tax competitiveness, and an unwillingness to lean into our strength in natural resources have all contributed to a lost decade for Canadian investment.<\/p>\n

Business investment has been so weak over the past decade that workers have less capital per member of the work force than they did in 2015, according to a C.D. Howe report published last December.<\/p>\n

These are the colossal weaknesses that the Carney government is charged with undoing, all while under the pall of American aggression. <\/p>\n

Finally, there are early indications that the turnaround effort is on the right track. <\/p>\n

According to the Bank of Canada\u2019s latest business outlook survey, a net of 30 per cent of companies say they will increase spending on machinery and equipment (M&E) over the next year. The long-term average is around 16 per cent.<\/p>\n

While intentions don\u2019t equate to real investment, the numbers are backed up by the latest import data, which point to a long-awaited rebound in M&E investment. <\/p>\n<\/p>\n

The Bank of Canada is attuned to the trend. \u201cBusiness investment is picking up, boosted in the near term by the oil and gas sector,\u201d Bank of Canada Governor Tiff Macklem said a few weeks ago.<\/p>\n

\u201cAlthough the Canada-U.S.-Mexico Agreement is now subject to annual reviews, more businesses report they are finding ways to navigate through the uncertainty.\u201d<\/p>\n

Tariffs<\/a> be damned, corporate Canada appears increasingly inclined to spend.<\/p>\n

Much of the recent uptick in investment, as Mr. Macklem noted, can be attributed to the energy sector. The endless drama over the Strait of Hormuz<\/a> has elevated oil prices and restricted global supply, thus triggering increased production in Canada. This could easily prove to be a fleeting boost for Canadian oil and gas.<\/p>\n

Still, it seems like there is more to the story than a temporary disturbance in the oil market. The surge in imports of computer equipment used in data-centre construction, for example, is also encouraging. \u201cAfter a slow start, AI investment finally seems to be taking off in Canada,\u201d Ms. Paquet said.<\/p>\n

Fingers crossed, the narrative in Canada is changing at last. <\/p>\n

That\u2019s not to discount the damage that the trade war has wrought. The manufacturing sector is getting hammered. Regional economies, particularly in Ontario and Quebec, have suffered more than glancing blows.<\/p>\n

But overall, the Canadian economy is still standing. GDP growth bounced back from negative territory to an estimated 3.4 per cent annualized in the second quarter. It also helps that the Canadian stock market has held its own this year, with a solid 16-per-cent gain in the S&P\/TSX Composite Index year to date.<\/p>\n

All of which strengthens Canada\u2019s hand in trade negotiations.<\/p>\n

Mr. Trump wanted Canada in a weakened state to wring as much from a vulnerable trading partner as possible. It hasn\u2019t gone entirely according to plan. <\/p>\n","protected":false},"excerpt":{"rendered":"Long before Donald Trump started sticking it to us, Canada has wrestled with a stubborn investment problem. After…\n","protected":false},"author":2,"featured_media":859219,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[901,888,902,879,877,903,45,49,48,876,895,896,891,878,875,46,549,295,894,887,914,880,881,893,889,890,884,904,885,909,910,912,907,911,905,908,882,898,899,714,897,906,865,61,900,892,886,883,913],"class_list":["post-859218","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-alberta","tag-arts-news","tag-bc","tag-breaking-news","tag-breaking-news-video","tag-british-columbia","tag-business","tag-ca","tag-canada","tag-canada-news","tag-canada-sports","tag-canada-sports-news","tag-canada-trafficcanada-weather","tag-canadian-breaking-news","tag-canadian-news","tag-economy","tag-education","tag-environment","tag-federal-government","tag-foreign-news","tag-globe-and-mail","tag-globe-and-mail-breaking-news","tag-globe-and-mail-canada-news","tag-government","tag-life-news","tag-lifestyle","tag-local-news","tag-manitoba","tag-national-news","tag-new-brunswick","tag-newfoundland-and-labrador","tag-northwest-territories","tag-nova-scotia","tag-nunavut","tag-ontario","tag-pei","tag-photos","tag-political-news","tag-political-opinion","tag-politics","tag-politics-news","tag-quebec","tag-sports-news","tag-technology","tag-travel","tag-trudeau","tag-us-news","tag-world-news","tag-yukon"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/859218","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=859218"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/859218\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/859219"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=859218"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=859218"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=859218"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}