Following Mark Carney’s Liberal party securing an election victory, two experts say Canada’s business sector would have preferred the stability that comes with a majority government.
On Monday night, CTV News declared a Liberal minority and when seat counting was paused. Elections Canada paused vote counting of special ballots early Tuesday morning, where the Liberals were leading or elected in 168 seats, four short of a majority, with a number of ridings appearing to be too close to call.
Lisa Raitt, vice-chair of global investment banking at CIBC Capital Markets and former deputy leader of the Conservative Party, said in an interview with BNN Bloomberg Tuesday voters have returned minority governments in many of Canada’s recent elections, “which from a corporate standpoint is not necessarily a good thing.”
“You want to see a little bit more certainty. You want to see a little bit more longevity because when you have a minority government, yes, you’re dealing with the current issues of the day, but you’re also in the back of your mind trying to think about how you’re going to get that majority government,” she said.
“Because the majority government in the Canadian parliamentary system has a lot of power and a lot of ability to get the big projects that you want done.”
John Manley, chair of Jefferies Canada, senior adviser to Bennett Jones, former finance minister, and former deputy prime minister said he agrees that a majority government would have been a preferred outcome for Canada’s business community. However, he added the result is “pretty close.”
“We’ve seen this kind of government in the past, they really function on an issue-by-issue basis and that’s actually not a bad discipline. It’s in nobody’s interest right now to provoke another election anytime soon,” he said.
Manley said that if Carney fulfills the spirit of his victory speech and governs “for all Canadians” then “he can probably run this government for quite a long time.”
‘Sit at the table’
On issues related to U.S. trade, Manley said he thinks Carney will have the support of the Conservatives and the New Democratic Party in negotiations with U.S. President Donald Trump.
“I think the question that he needs to be thinking about right now is how do you begin a negotiation with somebody who’s already in breach of the agreement you already have with them,” he said.
“In other words, this is not like what we just saw with the Japanese, for example. It’s not the Europeans. We actually already have a trade agreement with the United States, and not only that, it was signed with the first Trump administration. And on day one in office, he just ignored it.”
The United States-Mexico-Canada Agreement (USMCA) was negotiated by Trump during his first term and is up for renewal next year. Given the agreement, Manley said Carney may attempt to use USMCA compliance as a starting point for negotiations.
“He (Carney) may well decide to tell Mr. Trump that he’ll be happy to sit at the table with him as soon as he gets back into line with the agreements that he’s already committed to,” he said.
“In other words, take the tariffs off steel and aluminum, take the tariffs off autos, take the tariffs (off) the other commodities that may or may not be caught in this. It’s very confusing for the customs brokers to figure out what’s tariffed and what isn’t at this point. But let’s go back to the USMCA, and if you want to negotiate changes to that, let’s talk.”
