U.S. tariffs hike drags down Canada's economic growth in 2025

Statistics Canada released data on the 27th showing that, affected by the disruption to normal trade caused by the U.S. tariffs, Canada’s exports in 2025 fell significantly, and economic growth slowed to 1.7%, the lowest level since 2020.

The data show that Canada’s real gross domestic product (GDP) contracted by 0.2% in the fourth quarter of last year, far below the 0.6% growth level in the previous quarter. Statistics Canada said that in the second quarter last year, Canada’s exports to the U.S. fell sharply and did not recover in the second half of the year. As a result, Canada’s exports for the full year declined by 1.7%, dragging down economic performance.

The manufacturing sector, hit by the impact of the U.S. tariffs, became the biggest drag on Canada’s economic growth last year. At the same time, among Canada’s 20 industrial sectors last year, 16 expanded. Of those, helped by an abundant agricultural harvest, Canada’s agricultural product inventories rose for the first time in three years; household final consumption expenditure grew by 2.3%, roughly in line with the growth rates of the prior two years; and in the area of capital investment, total investment in 2025 grew by 1.4%, with the stimulative effect of government investment notably significant. (Xinhua News Agency)