How Interprovincial Trade Barriers Impact Calgary’s Mortgage Market
Interprovincial trade barriers in Canada have long been an overlooked issue, but with growing economic uncertainties—including challenges with our largest trade partner, the U.S.—they are becoming a mainstream topic of discussion. These barriers create inefficiencies that weaken Canada’s economic resilience and limit opportunities for businesses and workers alike.
As a leading mortgage brokerage in Calgary, Spire Mortgage Team recognizes the importance of a strong, adaptable economy. A robust business environment ultimately fuels job creation, population growth, and homeownership opportunities. Let’s explore why reducing interprovincial trade barriers is crucial and how it could impact businesses, consumers, and even the mortgage industry.
What Are Interprovincial Trade Barriers?
Interprovincial trade barriers refer to restrictions that hinder businesses and workers from operating across provincial lines. These can take many forms, including:
Regulatory differences – Variations in licensing, safety certifications, and professional credentials between provinces.
Restricted goods and services – Some provinces limit the sale of certain products across their borders.
Geographic challenges – Transportation costs and infrastructure gaps that increase trade expenses.
These barriers not only stifle competition but also make it difficult for businesses to expand, workers to relocate, and consumers to access goods and services at competitive prices.
How Much Do These Barriers Cost the Economy?
The economic impact of interprovincial trade barriers is significant. Studies estimate that they impose an economic burden equivalent to a 6.9% to 21% tariff on trade flows within Canada. To put that into perspective, Canada’s weighted average tariff on international imports is just 1.4%—far lower than the costs of trading within our own country.
By reducing or eliminating these barriers, Canada could see economic gains of up to $200 billion annually. This translates to higher GDP growth, job creation, and more disposable income for Canadians—all factors that directly influence housing demand and mortgage markets.
The Benefits of Reducing Internal Trade Barriers
While removing trade barriers won’t solve all of Canada’s economic challenges, it is a step toward improving efficiency, productivity, and competitiveness. Here’s how it could make a difference:
Boost Business Expansion – Businesses could scale across provinces without dealing with excessive regulatory hurdles.
Increase Job Opportunities – Workers would have greater mobility, allowing them to pursue opportunities without unnecessary licensing restrictions.
Enhance Economic Resilience – Strengthening domestic trade would make Canada less reliant on international markets, mitigating risks from global trade disruptions.
Support the Housing Market – A thriving economy leads to population growth and increased demand for housing, which directly impacts the mortgage industry in Calgary and beyond.
Will Removing Trade Barriers Offset U.S. Market Challenges?
While trade liberalization within Canada is beneficial, it is not a direct substitute for strong U.S. trade relations. The U.S. remains Canada’s largest trading partner, with over $1 trillion in two-way trade annually. In contrast, interprovincial trade accounts for roughly $532 billion.
However, internal trade liberalization would enhance Canada’s self-sufficiency and strengthen its economic foundation, making it less vulnerable to external trade shocks. By improving domestic trade efficiency and reducing business costs, it can complement international trade efforts.
Which Provinces and Sectors Stand to Benefit the Most?
Some of the biggest winners from reducing interprovincial trade barriers would be smaller provinces like Prince Edward Island, Newfoundland & Labrador, and Nova Scotia, where trade costs are currently highest. Additionally, service-based industries—such as financial services, legal services, and healthcare—would benefit significantly due to the high non-tariff trade costs they face.
For Calgary, this could mean more competitive business conditions, an influx of professionals from other provinces, and increased demand for commercial and residential real estate.
How Can Trade Barriers Be Reduced?
While geographic barriers are harder to overcome in the short term, non-geographic barriers can be addressed through:
Standardizing regulations – Mutual recognition of professional credentials and safety standards across provinces.
Enhancing transportation infrastructure – Investments in supply chain improvements to lower trade costs.
Strengthening agreements like the Canadian Free Trade Agreement (CFTA) – Reducing provincial exceptions to create a more seamless national market.
What This Means for Calgary’s Mortgage Market
A stronger economy with fewer barriers to business growth means increased job creation, more homebuyers entering the market, and greater financial stability for homeowners. As businesses thrive and workers find it easier to relocate for job opportunities, demand for housing in Calgary is likely to rise, benefiting both buyers and real estate investors.
At Spire Mortgage Team, we believe in supporting economic policies that contribute to a healthier, more accessible housing market. Whether you’re looking to buy your first home, refinance, or invest in real estate, our team is here to help you navigate Calgary’s dynamic mortgage landscape.
Credit to RBC Economics
Much of the discussion in this article was inspired by Salim Zanzana’s analysis of interprovincial trade barriers, published by RBC Economics on February 25, 2025. His insights have provided valuable perspectives on the economic impacts and potential benefits of reducing these barriers across Canada.
Ready to Secure Your Mortgage in Calgary?
With economic shifts on the horizon, having the right mortgage strategy is more important than ever. Contact Spire Mortgage Team today at www.spiremortgage.ca to explore your options and make informed financial decisions for your future.
