ATB’s fifth annual Business Summit was held last week in Edmonton. The theme this year, Navigating a New Era: Resilience, Trade and the Alberta Advantage, provided fertile ground for an economic update to Alberta’s business leaders. Sifting through the noise, the presentation took many turns, ending with some cautious optimism. Here are the key takeaways.  

Surviving the shock

While preparing for the presentation, I couldn’t help but reflect on where we were this time last year; facing existential dread over sweeping U.S. tariffs. Today, the dust has settled into a new normal.

We at ATB Economics have discussed the ‘rupture’ and ‘new world order’ at length over the past few months. From U.S. protectionism to the UAE exiting OPEC, nations are looking inward. In the post-rupture world, economic strength is being used by countries to exert force on others; geopolitics are the central variable changing how countries organize trade.

Equity markets have staged a post-tariff comeback, fuelled by an AI boom that’s been driving the economy amid geopolitical turmoil. Even with the impact of the Iran war choking the Strait of Hormuz—which transports about a fifth of global oil and natural gas (and is also a key route for fertilizer)—markets are signaling that the crisis will pass and the Strait will soon reopen.

Diagnosing the engine

Looking under the hood of the national economy tells a deeper story. Over the last decade, Canada's real GDP per capita has struggled to grow. Consumer and government spending have carried the load, while private business investment and international exports have lagged behind.

The Bank of Canada cannot save the consumer this time with ultra-low interest rates. Driven by war and global supply shocks, the Bank’s Governing Council will look through short-term spikes in gasoline, diesel and fertilizer costs, but will not let high prices persist. The policy interest rate is forecast to hold steady at 2.25% this year, but risks are tilted to higher (not lower) rates if energy costs remain elevated and feed through the broader basket of goods and services we purchase every day.

This malaise affects everyday lives: an overwhelming 66% of Canadians cite the rising cost of living as one of the most important issues facing Canada. The affordability crisis is reshaping society—the share of young adults living with their parents has been rising, especially in expensive housing markets.

The CUSMA reality check 

As part of the Summit’s panel on trade, Adam Legge (Business Council of Alberta) and Theo Argitis (Business Council of Canada) emphasized that this era of uncertainty requires corporate planning to build structural resilience. Argitis highlighted that supply chains are shifting away from vulnerable ‘just-in-time’ systems, pushing commercial inventories to their highest levels since the 1990s as a hedge against global shocks.

Regarding the mandatory July 1st CUSMA review milestone, both panelists urged business leaders to tune out the political theatre, and keep in mind that even if a deal isn’t reached on July 1, our existing trade agreement won’t fall apart. 

Given the uneven nature of U.S. tariffs across industries, the key will be presenting a united front while addressing regional grievances. For example, Ontario and Quebec will be looking for the reduction or elimination of aluminum and steel tariffs. While Alberta is relatively insulated given its composition of exports (primarily energy), it will join other provinces in looking to preserve its exemptions on CUSMA compliant goods. Rather than expecting friction-free access, the true path forward requires Canada to aggressively market its assets while patiently courting foreign capital to build connections to global buyers.

Seizing the opportunity 

We cannot sit back and wait for the world to change. Our dependence on sending trade south leaves us at the mercy of U.S. politics. Prime Minister Mark Carney has announced a goal to double Canada's non-U.S. exports over the next decade, expanding our global trade footprint.

To get there, we can leverage structural advantages, such as:

• Global Energy Infrastructure: We have proven that we can build big things. The completion of the Trans Mountain expansion (TMX) sent oil exports to Asia on a hockey-stick surge from near-zero in 2023 to $9 billion last year. Similar structural liftoffs are visible at the Ridley Island Propane Export Terminal and LNG Canada Phase 1.
• AI Infrastructure: Private construction of U.S. data centres is accelerating at a historic annual rate exceeding $45 billion. AI requires immense baseload power, positioning Western Canada—with its vast natural gas reserves and world-class AI research— in the middle of this wave.
• Agri-Food and Tourism: Alberta is transforming raw commodities into high-value revenue. Private footprints like McCain's manufacturing buildouts are making Alberta a processing hub, while Canada offers water advantages as drought concerns mount. Simultaneously, international tourism is taking flight as a service export, unlocked by expanded global airport capacity.

Now what?

The upside in our economic forecast doesn't come from hoping that the external geopolitical chaos resolves itself. It comes from within Canada’s borders.

If we take advantage of the opportunities in front of us—streamlining regulation, building critical infrastructure, and driving investment—we’ll finally put running shoes on and chart a new path forward.

Answer to the previous trivia question: The Montreal Canadiens are playing the Carolina Hurricanes in the Eastern Conference Final of the NHL Playoffs.

Today’s trivia question: Why is Memorial Day in the U.S. also known as Decoration Day?