TORONTO — Prime Minister Mark Carney announced wide-ranging new measures to support Canadian industries most heavily impacted by U.S. tariffs, sweeping “buy Canadian” rules for the federal government as well as reviews of controversial Justin Trudeau-era climate policies on Friday.
While they touched on a broad number of sectors and programs, all the measures announced on Tuesday were linked to one objective: helping key Canadian industries and workers transition away the U.S. market they’ve depended on for decades.
“What’s going on is not a transition, it’s a rupture, and its effect will be profound. Workers displaced from their jobs, supply chains that have existed for decades disrupted,” Carney said.
Carney also announced that Canada’s zero-emission vehicle sales mandate that was set to come into effect in 2026 will be delayed for a year while the government reviews the policy.
The mandate, which would have required at least 20 per cent of new vehicles sales in 2026 to be zero-emission vehicles, has attracted concerns from auto-makers in recent months. By 2035, the mandate would have required 100 per cent of new vehicle sales to be zero-emission.
Speaking at an airplane manufacturer in suburban Toronto, Carney said the government would launch an immediate 60-day review of the policy “to reduce costs.”
He also announced a new “buy Canadian” policy that would require the federal government to use Canadian suppliers and require local content when there are no domestic suppliers available. The approach would extend to Crown corporations and “provide a roadmap” for provinces and municipalities to follow suit.
The new policy will be launched in November and apply first to steel and softwood lumber products in defence and construction projects exceeding a certain, yet-to-be-announced value. The government says the policy will then be expanded further.
A key change to Canadian content requirements in existing procurement rules is that the new policy will also extend to projects funded via federal grants and contributions. The government estimates the changes will extend the rules to an additional $70 billion in spending.
The new policy is similar to “buy American” policies pushed by both the Biden and Trump administrations in the U.S. over the last five years.
“Now we need to use government procurement using Canadian taxpayer dollars to spur Canadian businesses for longer term prosperity to support Canadian industries,” Carney said.
Carney’s announcement comes amid a sluggish Canadian economy that shed 66,000 jobs in August. Friday morning, new data showed Canada’s unemployment rate hit a
nine-year high at 7.1 per cent
last month.
“This makes decisive action crucial,” Carney said of the new bleak unemployment numbers.
Carney announced dozens of measures and billions of dollars-worth of new funds that would compel the federal government to prioritize Canadian suppliers in procurement, create a new $370-million biofuel production incentive and a $5 billion “Strategic Response Fund” to help tariff-impacted companies retool and retrain employees.
The Strategic Respond Fund replaces the existing Strategic Innovation Fund but provides similar support: funding to companies in any sector looking to retool or reorient their activities due to the impacts of Donald Trump’s tariffs.
“This fund has three core objectives: first, to help businesses pivot to new products and markets. Secondly, to retrain and retain skills and production here in Canada. And thirdly, to make our businesses globally competitive,” Carney explained.
Beyond suspending the EV sales mandate, Carney announced a review of other controversial Justin Trudeau-era climate policies. He namely promised unspecified changes to the Clean Fuel Regulations.
The changes highlight an ongoing tension within the Liberals of wanting to maintain environmental policies while yearning to address Canada’s decades-long productivity lag.
Mockingly branded the “carbon tax 2.0” by Conservative leader Pierre Poilievre, the Clean Fuel Regulations aim to boost innovation and adoption of green technologies and expand the use of low carbon intensity fuels.
“The government intends to amend the Clean Fuel Regulations to strengthen the resiliency and spur the development of Canada’s low-carbon fuel sector. Only targeted amendments that advance this objective will be considered at this time,” reads a background document published by the federal government.
Thursday, Finance Minister François-Philippe Champagne’s office told National Post work is underway for an upcoming review on whether the tariffs Canada applied to China’s electric vehicles, steel and aluminum should remain at the current rates.
Flavio Volpe, head of the Automotive Parts Manufacturers’ Association, applauded the government’s decision to suspend and review the much-maligned EV sales mandate.
“We punted on the EV mandates at a time when this isn’t going to work, but I like the fact that we’ll do a short review,” he said. “While we’re trying to make sure that those foreign automakers remain committed here, let’s not punish them with $3 billion of new costs.”
National Post, with files from Stuart Thomson.
cnardi@postmedia.com
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