Prime Minister Mark Carney is set to present his government’s first federal budget on Tuesday, and has warned Canadians to expect “sacrifices” as he aims to transform an economy battered by US President Donald Trump’s tariffs.Carney has said the spending plan will see both significant cuts and “generational investments” to strengthen the economy and reduce the country’s reliance on US trade.The plan is also expected to lay out how Canada will pay for billions of dollars in defence spending to fulfil the new Nato commitment to spend 5% of GDP on defence by 2035. Analysts have suggested the federal deficit could exceed C$70bn ($50bn; £38bn), up from $51.7bn last year.The fiscal plan is seen as a major test for Carney, a former central banker for Canada and the UK who has promised to make Canada’s economy the strongest in the G7 group of wealthy nations.”We used to take big, bold risks in this country. It is time to swing for the fences again,” he said in a pre-budget speech last month. Canada, which trades primarily with the US, has a particular exposure to tariff shocks.Carney has said he is setting a goal for the country to double its non-US exports in the next decade.Joy Nott, a partner at KPMG Canada who focuses on trade and customs, told the BBC that “Canadian companies need government support during the transition of moving from one market to another”.That includes everything from finding money to travel on trade missions abroad to market research and navigating regulatory approvals when entering new markets.It takes time and money to overcome “those historic hurdles that we’ve seen, that prevented them from doing it”, Ms Nott said.Finance Minister Francois-Philippe Champagne underscored the “made-at-home” message on Monday as he bought new shoes – a political pre-budget tradition for federal finance ministers …
