Finance Minister François-Philippe Champagne highlighted a recent International Monetary Fund (IMF) report indicating that while the global economy is resilient in the face of U.S. tariffs, trade uncertainty remains a hindering factor. Champagne is currently in Washington for various meetings involving G7 and G20 finance ministers, as well as the annual sessions of the IMF and World Bank Group.
During an interview at the IMF headquarters, Champagne emphasized the importance of stability and predictability in the world economy, with Canada standing out as a key player in achieving these goals. He underscored the necessity for collective action within the G7 to reduce uncertainty amidst the challenges faced by the global economy.
The IMF’s latest report revealed that although global growth has been modest, it is more optimistic than previously anticipated. However, the report cautioned that significant risks persist due to the imposition of substantial U.S. tariffs, contributing to a volatile economic environment.
Projections suggest a gradual slowdown in global growth from 3.3% in 2024 to 3.1% in 2026. The IMF report highlighted the negative impact of prolonged uncertainty, protectionist measures, and potential shocks on labor supply, which could impede growth. It also warned of fiscal vulnerabilities and potential market corrections that could threaten stability.
Canada has been significantly affected by tariffs imposed by U.S. President Donald Trump, leading to a projected growth rate of 1.2% for the country this year. Despite the challenges, the IMF forecasted that Canada is positioned to be the second-fastest-growing economy among the G7 nations next year, following the United States but surpassing the United Kingdom.
Trade uncertainties persist in Canada, with efforts ongoing to address Trump’s tariffs. The IMF’s revised growth projection for Canada in 2025 is notably lower than previous estimates, reflecting the impact of trade tensions on the Canadian economy.
President Trump’s proposed additional tariffs, including those on pharmaceutical and aerospace products, add to the economic uncertainties faced by Canada. Despite recent meetings between Canadian and U.S. officials, trade negotiations continue as both countries navigate the evolving trade landscape.
Champagne emphasized the need for fiscal discipline and strategic investments to drive economic growth, aligning with the IMF’s recommendations. Looking ahead, the Canadian government is preparing to unveil its federal budget next month, focusing on generational investments to support national development.
As Canada seeks to enhance its economic resilience, Champagne expressed confidence in the nation’s prospects, citing its trade agreements, natural resources, and skilled workforce as key strengths in ensuring long-term prosperity.