The Canada Investment Summit is shaping up as a defining moment in Prime Minister Carney’s effort to reorient the country’s economy away from the United States, as a deepening trade war between the two neighbours continues to cost jobs and squeeze household budgets on both sides of the border.
The dispute has been running since President Donald Trump returned to the White House and launched a sweeping global tariffs programme. Canada was among the first countries targeted, and has been one of the few to respond with its own counter-measures. The US has placed levies on Canadian steel, aluminium, lumber and automobiles, and last week added a further 50% tariff on around C$28bn ($20bn; £15bn) of Canadian goods. Canada has replied with what it calls a ‘dollar-for-dollar’ and ‘strategic’ retaliation, announcing counter-tariffs on Tuesday designed to match the US measures.
The Canada Investment Summit and the Push for New Partners
Against that backdrop, Carney’s government is hosting the first-ever Canada Investment Summit in Toronto in September, bringing major investors, chief executives and business leaders together for two days. According to the Prime Minister of Canada, the summit is being organised by the federal government in partnership with the Canada Pension Plan Investment Board (CPP Investments) and the Public Sector Pension Investment Board (PSP Investments), two of the country’s largest institutional investors.
The event will be held at the Four Seasons Hotel in downtown Toronto, according to The Globe and Mail. The provinces are also mobilising: CityNews Toronto reports that Alberta Premier Danielle Smith plans to pitch investors on a list of 34 proposed projects at the gathering.
The summit comes at a moment when foreign direct investment into Canada reached C$96.8 billion in 2025, the highest inflow of capital to the Canadian economy since 2007. Canada’s economy also rebounded strongly in the second quarter of 2026, posting 3.3% GDP growth driven by a jump in exports and domestic investment. Those figures have eased recession fears, at least for now, though the impact of the most recent US tariffs has yet to be fully felt.
Which Regions Are Feeling the Trade War Most
Not every part of Canada or the United States is equally exposed. Ontario, the most populous Canadian province with a large manufacturing base, has been hardest hit by the auto and steel tariffs. Several Ontario auto parts and assembly plants have announced layoffs and production cuts, and the province is estimated to have lost tens of thousands of manufacturing jobs since early 2025. A report by the Canadian Chamber of Commerce identified three Ontario cities (Oshawa, London and Kitchener-Cambridge-Waterloo) as particularly vulnerable, noting they ‘remain heavily tied to the US market, while growth in exports outside the US has been limited or insufficient to offset broader weakness in trade activity and local economic conditions.’
Metal exports from Quebec fell 36% between February 2025 and 2026, with a 3.6% drop in sector employment, according to data released in July. The Royal Bank of Canada estimates that Ontario and Quebec are the most exposed to US sectoral tariffs overall, while Newfoundland and Labrador, New Brunswick, Alberta, Saskatchewan and Prince Edward Island are the least affected.
On the American side, Canada’s counter-tariffs are targeted partly at politically sensitive states. According to Statistics Canada data, Ohio will be hardest hit, with C$3.2bn, or 12%, of its exports set to face Canadian tariffs, followed by Illinois and Pennsylvania. Derek Holt, an economist with Scotiabank, noted that the counter-tariffs appear ‘very deliberately oriented’ towards swing states that could influence the outcome of upcoming US midterm elections.
The average effective US tariff rate on Canada stood at 2.9% in June, the lowest among major US trading partners according to the Royal Bank of Canada. It has since nearly doubled to 5.7%. By comparison, the US effective tariff rate on the UK sits at 6.2%, while China faces the highest rate at around 20.5%.
Around 55,000 manufacturing jobs have already been lost in Canada between January 2025 and January 2026, according to Bank of Canada data. Calgary-based economist Trevor Tombe estimates that a total of 90,000 jobs across Canada could be lost if the new US tariffs persist. In the US, the non-partisan Center for American Progress estimates that Trump’s ‘Liberation Day’ tariffs on dozens of America’s trade partners have also resulted in tens of thousands of jobs lost in manufacturing, transportation and warehousing. The US-based Tax Foundation estimates that an average American household could pay $840 more this year due to Trump’s tariffs.
Some Canadian businesses are finding ways to adapt. Matteo Sgaramella, who owns Toronto-based menswear clothing company Outclass, told the BBC he has started attending trunk shows in Paris rather than New York to reach European customers. ‘The reception has been amazing,’ he said, adding that some European stores are ‘particularly enthused’ about supporting Canadian products because of the trade war. Carney has pledged to double Canada’s non-US exports over the next decade, and Bank of Canada statistics indicate that Canadian firms have already been exporting more to countries outside the US since January 2025. Whether that momentum can be broadened to the manufacturing heartlands of Ontario will be one of the central questions the Canada Investment Summit is expected to address.
