The Door Is Open: How Canadian Businesses Can Diversify Exports and Build a Resilient Economy

Published: Nov 1 2025 | Shannon Peel, MarketAPeel

https://www.youtube.com/watch?v=34JWXFbGy-I

The federal government has done its part. Carney has signed trade agreements, launched export programs, sent trade missions to Asia, signed energy deals with Europe, and opened doors with markets that Canadian businesses have barely glanced at.

Now it is up to Canadian businesses to walk through them. Canadian Businesses need to Diversify Exports if they want to weather the geopolitical storm we are in.

No government can force a company to find new customers. No trade agreement sells your product for you. What the government can do, and has done, is reduce the barriers, provide the intelligence, share the risk, and open the doors. What happens next depends entirely on Canadian entrepreneurs and business owners deciding they are done being dependent on a single customer.

That single customer represents an extraordinary vulnerability. And the data makes it impossible to ignore.

The One-Customer Problem for Canada

I spent ten years in the investment industry. The first principle they teach you, the one that is fundamental to every portfolio strategy, is that you do not put all your eggs in one basket. You diversify because diversification cuts risk, builds resilience, and ensures that when one position moves against you, the rest of the portfolio holds you up.

Canadian businesses have been running the exact opposite strategy for four decades.

Canada's exports account for roughly one-third of GDP, and nearly 70% flow to a single market, the United States. That model has changed little over the past 25 years.

Roughly three quarters of Canada's merchandise exports are directed to the United States, representing almost one-quarter of Canadian GDP. The sum of Canadian imports and exports was two-thirds of GDP in 2024, by contrast, the United States' imports and exports were just one-quarter of their GDP in that same year.

The asymmetry in that last sentence is the whole story. Canada's economy is more than twice as trade-dependent as the US economy, and almost all of that trade dependence flows in a single direction. When the US decides to impose tariffs, change policy, or simply slow down economically, Canada does not have the same cushion the US has.

In 2024, 76% of Canada's merchandise exports were destined for the United States. Export volumes plunged 7.5% in the second quarter of 2025, the largest decline since 2009, excluding the COVID-19 pandemic period. About one in six exporters planned to delay investment or expansion in the third quarter.

This is what single-customer dependency looks like when the customer changes the terms of the relationship.

The Good News: Diversification Is Already Working

The businesses and regions that have started diversifying are demonstrating that the strategy works.

Measured on a customs basis, Canada's domestic exports to the United States fell by $29.4 billion in 2025, a 5.4% decline, while shipments to other countries rose by $27.6 billion, a 15.8% increase.

A Canadian Chamber of Commerce report found Calgary and Ottawa-Gatineau posted the largest increases in exports to non-US markets between 2024 and 2025, 64.67% and 64.04% respectively. Toronto's non-US exports increased by 32.82%, followed by Saskatoon at 32.04% and Kelowna at 28.63%.

Nova Scotia provides one of the most instructive case studies. When China imposed 25% tariffs on Canadian seafood products, Nova Scotia's seafood exports to China dropped 34% year-to-date, a severe single-sector hit. But the overall damage to Nova Scotia's economy was limited because export diversification had already begun. The province's relative insulation from ongoing trade headwinds meant it was expected to outperform the national economic average in 2026.

That is the lived proof of the diversification argument. Businesses and regions that spread their customer base across multiple markets absorbed the shock. Those that had not are absorbing the full impact.

TD Economics estimates that a 5% reduction in US export share could add 0.4 percentage points to Canada's GDP growth by 2030. The federal government has set an ambition to double non-US exports by 2035. BCG estimates that achieving this goal would be equivalent to roughly $10,000 per Canadian household, 5% of GDP, or the value of Canada's entire mining, quarrying, and oil and gas sectors combined.

That is not a policy aspiration. That is an economic opportunity, and Canadian businesses are the ones who have to seize it.

The Honest Assessment of Where Things Stand

The Chamber of Commerce report is encouraging, but it also contains a warning that every Canadian business owner needs to hear.

While exports to non-US markets rose sharply between 2024 and 2025, much of that growth came from existing exporters expanding their reach rather than new firms entering global markets. The number of Canadian exporters selling to non-US markets increased by just 6% year over year. While fewer businesses report taking no action compared to a year ago, relatively few are actively diversifying sales or suppliers outside the US.

That is the gap. The doors are open. The support programs are funded and operational. The trade agreements cover economies representing 61% of global GDP. And the majority of Canadian businesses that are dependent on US customers are still waiting, still hoping the tariff situation resolves, still running the single-customer portfolio that no investment advisor would ever recommend.

The Tools Most Canadian Businesses Never Use

Here is what exists right now, available to Canadian businesses of any size:

The Trade Commissioner Service

The Trade Commissioner Service has been helping Canadian companies grow internationally for over 125 years. Their network of trade commissioners operates in more than 160 cities around the globe, connecting Canadian businesses with qualified contacts, funding, support programs, and market intelligence in international markets.

This is not a call centre. Trade commissioners are in-market specialists who can provide tailored assessments of whether your product or service has commercial potential in a specific country, connect you with qualified local buyers and distributors, help you understand regulatory requirements before you spend money entering a market, and refer you to financing and insurance programs specific to that market.

The TCS served over ten thousand Canadian business clients in 2024-25. Canada has 15 free trade agreements covering economies representing 61% of global GDP. The infrastructure exists. The question is whether your business is using it.

To reach the Trade Commissioner Service: visit tradecommissioner.gc.ca or call your nearest regional office to be connected with a trade commissioner in any of 160+ global locations.

Export Development Canada

Export Development Canada is Canada's export credit agency — and it addresses the single biggest fear most businesses have about selling internationally: what happens if a foreign buyer does not pay, or if political instability disrupts a market where you have inventory.

EDC provides credit insurance that protects Canadian exporters against non-payment. It provides financing solutions that help Canadian companies offer competitive payment terms to foreign buyers without straining their own cash flow. It provides bonding services that allow Canadian companies to bid on foreign contracts. And it connects businesses with international buyers through matchmaking programs.

In March 2025, EDC launched a Trade Impact Program providing $5 billion over two years in additional financing and insurance capacity specifically for companies affected by US tariffs, covering credit insurance, export guarantees, and direct financing for all company sizes.

EDC supported more than 27,800 Canadian businesses last year. The website is edc.ca.

The Business Development Bank of Canada

The BDC focuses on financing and advisory services for small and medium-sized businesses, including specific support for preparing for international growth. If you have an existing relationship with a BDC advisor, this is the conversation to have: what financing and advisory support exists for market diversification? What does the BDC offer to help your business reduce its US dependence and build export capacity into new markets?

The BDC is not just a lender. Its advisory services — market research, business planning, international growth strategy — are available to businesses at various stages of export readiness. Visit bdc.ca.

The Canadian Commercial Corporation

The CCC is perhaps the least-known and most powerful tool available to Canadian businesses that sell to governments. The CCC is a government-to-government contracting agency. It allows Canadian companies to sell to foreign governments by leveraging Canada's sovereign guarantee. For a Canadian SME, winning a foreign government contract is normally nearly impossible, the regulatory complexity, the payment risk, and the lack of relationship with foreign procurement officials are all significant barriers. CCC removes those barriers by acting as the prime contractor, with the Canadian company as the service provider behind it.

If your company's products or services could be sold to foreign militaries, government agencies, public infrastructure projects, or other government buyers, the CCC is the path to explore. Visit ccc.ca.

CanExport Grants

CanExport SME provides grants covering 50% of eligible market development costs up to $50,000 for Canadian small and medium-sized businesses looking to develop export markets. Eligible activities include market research, translation of marketing materials, participation in international trade shows, and visits to foreign markets.

This is a grant, not a loan. Half your market development costs, up to $50,000, covered by the federal government. Most Canadian SMEs have never applied. Visit tradecommissioner.gc.ca/canexport.

Provincial Programs

Every province has its own export development programs layered on top of the federal ones. British Columbia has Export Navigator, a free one-on-one advisory service that connects BC businesses with export opportunities and programs. Alberta has the Trade and Agriculture Program. Ontario has the Ontario Together Trade Fund, which offers up to $5 million per business for market diversification and capacity expansion. The premiers are working at removing trafe barriers between them, and that in itself is an opportunity for Canadian businesses.

Contact your provincial economic development office or your MLA to find out what programs apply to your situation and your sector.

Canadian Businesses to Diversify Exports

If you are a business owner: do not delegate this to later. The window for building non-US customer relationships is now — while the Canadian brand is politically favoured in Europe, Japan, the UK, India, and across Asia. The trade missions have opened doors. The programs are funded. The trade commissioners are in place. Make the call.

Many Canadian Businesses have strong quarterly reports and our economy is staying strong, but for how long?

If you are an employee at a US-dependent business: this is the research to bring to your boss. The programs above represent a significant reduction in the financial risk of market diversification. Identifying which programs apply to your company's situation and presenting them with a recommendation is the kind of initiative that builds careers.

The investment principle is simple. You do not run a one-stock portfolio. You do not build a business that lives and dies by a single customer's decisions, especially when that customer has demonstrated, repeatedly, that it will change the terms of the relationship without warning and without accountability.

Canada has everything the world wants, resources, food, clean energy, technology, financial services, professional expertise. The world is buying. The government has opened the doors.

Walk through them.

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*Shannon Peel is the founder of MarketAPeel and a Narrative Strategist who spent ten years in the investment industry before building a career in brand strategy and communications. She publishes analysis on Canadian trade, business resilience, and economic opportunity at marketapeel.agency.*

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