VANCOUVER — Efforts by successive Canadian governments to diversify trade away from the United States have had only modest success over the past 25 years, according to a new study from the Fraser Institute.
The report finds Canada remains heavily reliant on the U.S. as its primary trading partner despite repeated policy pushes to expand exports to other markets.
“This federal government is not the first to prioritize diversifying trade away from the United States, and it’s important to understand the limited successes of previous efforts,” said Jock Finlayson, a co-author of the study.
The study shows the share of Canadian goods exports going to the U.S. declined only slightly, from 86.7 per cent in 1999 to 76.3 per cent in 2024. Over the same period, services exports to the U.S. dropped from 60.4 per cent to 51.6 per cent.
Researchers say several structural factors continue to anchor Canada’s trade relationship with the United States, including geographic proximity, shared language, similar legal systems and well-developed transportation networks.
“There are myriad reasons why so many Canadian exports flow to the United States, and counteracting those powerful factors to steer trade away from the U.S. has proven difficult in the past,” said Steven Globerman, another co-author.
The findings come as the federal government has set a goal of doubling trade with countries outside the United States within the next decade, a target the report suggests will be challenging to achieve based on past trends.
The Fraser Institute is an independent, non-partisan public policy think-tank.
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