Canada’s Prime Minister Mark Carney has put forward his first federal budget, which lays out an ambitious plan to transform Canada’s economy and deal with the challenge of US tariffs.Billed an “investment budget” by the government, the fiscal plan increases Canada’s deficit to C$78bn ($55.3bn; £42.47bn), the second largest in history. The spending is offset by plans to attract C$1tn of investment into Canada over the next five years, with the federal government arguing more restrained spending would eliminate “vital social programmes” and funding for Canada’s future. The budget does outline cuts, however, including slashing the size of the federal workforce by some 10% in the coming years. The budget was presented by Canada’s finance minister, François-Philippe Champagne, in the House of Commons late on Tuesday afternoon. In his budget speech, Champagne warned that Canada is facing “a time of profound change” and that “bold and swift action is needed” to ensure the country prospers.Peppered throughout the budget are references to uncertainty and the need for protectionist measures as a result of US tariffs on Canada. President Donald Trump has placed a broad 35% levy on Canadian goods not covered by an existing free trade agreement, and has tariffed specific sectors like steel, aluminium and automobiles. These levies, enacted earlier this year, have already led to Canadian job losses in those sectors, and business leaders have warned of a chill on investment in Canada due to trade uncertainty. To counter this, the budget proposes spending of C$280bn over the next five years “to strengthen Canada’s productivity, competitiveness, and resilience”. These include updating ports and other trade infrastructure with the goal of doubling Canadian exports to non-US markets over the next decade, as well as direct financing to support firms impacted by tariffs.The fiscal update also outlines a plan to boost Canada’s competitiveness, with the goal of making Canada a …
