OTTAWA — Calgary and Ottawa-Gatineau outpaced every other Canadian city in breaking away from reliance on the United States last year, growing their exports to non-US markets by more than 64 per cent each, even as Ontario’s industrial belt — the spine of Canadian manufacturing — slipped further into trade-related distress, according to a new report from the Canadian Chamber of Commerce released Tuesday.
The findings land at a moment when the question of whether Canada can meaningfully reorient its economy away from a single, unpredictable trading partner has shifted from long-term aspiration to urgent national policy. The federal government of Prime Minister Mark Carney has set a target of doubling non-US exports over the next decade, and the country’s spring economic update reported that non-US goods and services exports climbed by $33 billion in 2025 over the prior year.
But the chamber’s analysis, which cuts that national headline into a city-by-city portrait of winners and stragglers, reveals a country pulling in two directions at once. A handful of cities are quietly, structurally reshaping their trade footprints. The majority are not.
Calgary and Ottawa-Gatineau posted the largest year-over-year increases in exports to markets outside the United States, at 64.67 per cent and 64.04 per cent respectively. Toronto’s non-US exports grew by 32.82 per cent, followed by Saskatoon at 32.04 per cent and Kelowna, British Columbia, at 28.63 per cent. Across the country as a whole, non-US exports rose 16.8 per cent.
“Together, this relatively small group of cities account for a disproportionate share of Canada’s recent export diversification gains, reinforcing how uneven the country’s trade adjustment remains across regions,” the chamber said in the report.
The contrast with southern Ontario is stark. The report identifies Oshawa, London and Kitchener-Cambridge-Waterloo as cities showing “some of the clearest signs of trade-related economic stress.” These are communities whose economic identities were built on proximity to US supply chains — auto assembly, parts manufacturing, steel fabrication — and they remain deeply embedded in them. Non-US export growth in those cities has been, as the chamber puts it, “limited or insufficient to offset broader weakness in trade activity and local economic conditions.”
The chamber had flagged some of these vulnerabilities a year earlier, when a prior analysis identified Calgary, Saint John, N.B., and Windsor as the Canadian cities most exposed to US tariff risk. Victoria and Halifax, by contrast, were judged less vulnerable because their export bases already leaned toward Asia and Europe. The new report suggests those forecasts were broadly correct, if not perfectly calibrated. Cities with the heaviest US trade exposure are experiencing the most economic strain.
President Donald Trump’s tariff campaign against Canada has not let up. Steel, aluminum, automobiles and cabinetry are all subject to sector-specific US duties, and the Canada-US-Mexico Agreement — originally hailed as a stabilizing framework for North American commerce — is due for a formal review this year against a backdrop of Washington treating it more as a bargaining chip than a binding commitment. That uncertainty is filtering directly into corporate decision-making.
Recent Statistics Canada data on business responses to tariffs, cited in the report, shows that Canadian firms are “adapting cautiously” rather than fundamentally repositioning. Fewer businesses say they are taking no action compared with a year ago — a modest improvement. But relatively few are actively diversifying their sales or supplier relationships outside the United States. The more common responses are raising prices, shifting to domestic sourcing and delaying expansion plans.
Behind those aggregate numbers lies a structural puzzle that the chamber considers one of the most consequential gaps in Canada’s diversification drive: the growth in non-US exports came overwhelmingly from firms already selling abroad, rather than from new entrants into global markets. The number of Canadian exporters selling to non-US destinations grew by just six per cent year over year. Roughly 90 per cent of non-exporting Canadian businesses still describe their operations as essentially local in scope.
“The risk is that Canadian firms may be underinvesting in longer-term diversification at precisely the moment when resilience and market expansion are becoming more important to competitiveness and growth,” the report warns. The chamber’s prescription is not subtle: if Canada wants diversification to become structural rather than cyclical, small and medium-sized enterprises will need to enter global trade in far greater numbers.
Candace Laing, the chamber’s president and chief executive, framed the challenge in terms that acknowledge both what Canada has already achieved and how far it still has to go. Canada’s trade relationship with the United States will always matter deeply, she said, but the evidence from 2025 shows that resilience increasingly depends on not being at its mercy. “Some Canadian cities are adapting quickly to this era of repeated global economic shocks,” Laing said. “Canada does not just need more trade — it needs more traders.”
The chamber’s report arrives as the broader global trading environment continues to fragment. The assumptions that underpinned decades of Canadian export strategy — stable access to the United States, predictable rules-based frameworks, a Washington that valued its North American partners — look far less reliable than they did five years ago. The report cautions that trade conditions are likely to remain more volatile, more uncertain and more uneven going forward, and that the ability to adapt will depend heavily on where a firm operates, what it produces and how much of its business flows through a single market.
For the cities that have already begun that adjustment — Calgary, driven partly by an energy sector with global pricing and global buyers, and Toronto, whose financial and professional services exports travel more easily across borders than manufactured goods — the data suggest the pivot is real and accelerating. For the factory towns of southern Ontario, where full-time employment has already taken a significant hit, the window for a painless transition may be narrowing.
The government is betting it is not too late. The Carney administration’s stated goal of doubling non-US exports over a decade would require sustained growth well beyond the 16.8 per cent national rate recorded in 2025, and would demand that the gains spread from a small cluster of outperforming cities to the entire Canadian export base. Whether the firms holding back — waiting, as many seem to be, for Canada-US conditions to stabilize — will eventually conclude that stability is no longer coming may be the defining economic question of the next several years, as Trump’s tariffs continue to rewire global trade flows.
The chamber’s full report and city-level data are available through the Canadian Chamber of Commerce, as reported by multiple news organizations tracking Canada’s evolving trade posture.
