How the 2024 U.S. presidential election outcome could impact Alberta's economy

A Donald Trump presidency could raise costs for Canadian and Alberta companies while Kamala Harris’ policies are expected to have minimal direct impact on Alberta. Jean David Tremblay-Frenette, the chief economist with AIMCO joined CTV Morning Live’s Kent Morrison on what Albertans may see in the future.

 

This transcript has been edited for length and clarity.

 

Kent Morrison: The result of the U.S. election tomorrow could have a big impact on our province, no matter who wins. We welcome Jean David Tremblay-Frenette, the chief economist with AIMCO for more on this. Let's first talk about Donald Trump if he wins. He has talked about tariffs, what could that mean for us in Alberta?

Jean David Tremblay-Frenette: Trump's proposals are for wholesale protectionism. He's talking about a blanket 60 per cent tariffs on all imports coming from China, but also between a 10 and 20 percent tariffs on imports from all other countries, including Canada. So, in practice, it does mean higher prices for all the goods that Canadian and Alberta companies are using to produce the final goods.

Kent: That could make a big impact at a time when the Canadian dollar is also in a tough spot right now. Do we expect that to continue?

Jean David: Yes, frankly, at this stage, it's very clear that if President Trump is elected, then we're in for a period of potentially higher prices and higher inflation once again. That means that on both sides of the border, the central banks have to keep interest rates a tad higher.

Kent: What about Kamala Harris? Will there be an impact here in Alberta, if she wins?

Jean David: Actually, the impact of Harris' proposals are quite muted. She focuses more on domestic policy, not so much on foreign trade. That's a big policy difference. So more higher taxation for corporations in the U.S., but also more support for low income housing, a pursuit of the green agenda in the U.S. Overall, not much of an impact for Canada.

Kent: Now, this green agenda on renewables. What would that do for Alberta's energy sector?

Jean David: The reality here is that the energy transition process is one that is very protracted in nature.

We're talking about decades during which fossil fuels are still tremendously needed to run the global economy.

All-in-all, it doesn't mean much changes for Alberta, at least in the short to medium term.

We're still going to be exporting quite a bit of natural gas via some of the pipelines that are going through B.C. and off to Asia.

Kent: The USMCA, also known as the new NAFTA, needs to be renegotiated in 2026. What could be the impact of that deal, given one of these two leaders winning?

Jean David: On both sides, they've announced their callers by saying that they will seek a pretty comprehensive renegotiation of the USMCA trade agreement.

And what it means is that Canada should brace itself for a difficult negotiation process that will last for a while.

So for now, everything is looking relatively constant on the trade side. However, come 2026, and going forward, that will be a different story.

Kent: We appreciate your insight for us this morning, and we'll certainly be watching closely on Tuesday night.