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A recent report by the United Nations' International...
As we continue to grapple with the effects of tariffs, the Ontario government has taken a revolutionary step that could significantly improve the movement of goods, services and labor between Canadian provinces, eliminating the party-specific exemptions that exist under the 2017 Canadian Free Trade Agreement [1].
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What is this revolutionary step?
On April 16, Ontario Premier Doug Ford announced his intention to sign a Memorandum of Understanding (MoU) with all provinces and territories before July 1 [2] and has already done so with Manitoba, Nova Scotia, New Brunswick, Alberta, Saskatchewan and Prince Edward Island.
These MoUs will unconditionally remove the barriers to free trade between the provinces, allowing businesses to trade equilaterally. If they adopt a similar MoU with every territory, it is possible that the size of the national economy could be boosted by up to $250 billion per year.
The MoUs dictate that workers who are deemed acceptable in one province should be able to work in any other province, improving labor availability, reducing staff shortages and raising productivity. This, coupled with free movement of goods and services, should boost the economy and local businesses.
Despite facing criticism from opposition parties, Premier Ford is confident that these plans will simplify the bureaucratic burden that businesses are currently facing, helping them access new markets and customers and secure their bottom line.
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What is the next step for businesses?
35% [3] of Canada's trade already takes place within its own borders, so eliminating the red tape that adds unnecessary costs and delays to the movement of goods, services and people is a positive step that could see this figure increase exponentially through time, potentially offering a buffer against external market forces such as tariffs set by the US and China.
The Ontario government has launched a $50 million Ontario Together Trade Fund [4] that will support local businesses in accessing and exploiting the opportunities offered by these interprovincial trade agreements, diversifying to develop marketplace resilience, securing jobs, and improving competition. Eligible businesses must apply for grant funding or a loan under the program, demonstrating that they meet the eligibility criteria and clearly defining the way in which they will use the funding to meet its objectives.
Franchises with an Ontario presence should consider whether accessing the funding could improve their profitability and resilience. Franchises outside the region should keep a close watch on developments to see whether their provincial government will likewise sign an MoU with Ontario, easing their ability to trade across internal borders.
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Resources:
[1] https://www.cfta-alec.ca/
[2] https://news.ontario.ca/assets/files/20250416/a4cabc0945b955aa8573b59961908f24.pdf
[3] https://www.cbc.ca/news/canada/toronto/ontario-saskatchewan-memorandum-of-understanding-1.7549501
[4] https://www.ontario.ca/page/ontario-together-trade-fund
