Knocking down internal trade barriers could boost output in Canada by 7 percent
Canada is one of the world’s most open economies. Over decades, it has built deep and resilient links to global markets, anchored in openness, predictability, and rules-based trade. Yet at home, the Canadian economy remains much less integrated than its global footprint would suggest. Goods, services, and workers face significant barriers when moving across provincial and territorial lines—a fragmentation that affects productivity, competitiveness, and overall resilience.
This is not a new diagnosis. Canada’s internal market has long reflected its federal structure, with provinces exercising constitutional authority over many of the policies that shape commerce. These include licensing, standards, procurement, and service regulation. Over time, regulatory differences and administrative frictions have accumulated, acting as barriers to scale, competition, and mobility—especially in services, where the economic opportunities, and costs, are highest.
With global growth under pressure and productivity constraints becoming more binding, the case for integrating Canada’s internal market has likely never been stronger.
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