{"id":798,"date":"2020-11-10T15:40:09","date_gmt":"2020-11-10T15:40:09","guid":{"rendered":"https:\/\/www.rbc.com\/en\/economics\/2020\/11\/10\/what-will-a-biden-administration-mean-for-canada\/"},"modified":"2020-11-10T15:40:09","modified_gmt":"2020-11-10T15:40:09","slug":"what-will-a-biden-administration-mean-for-canada","status":"publish","type":"post","link":"https:\/\/www.rbc.com\/en\/economics\/canadian-analysis\/featured-analysis\/insights\/what-will-a-biden-administration-mean-for-canada\/","title":{"rendered":"What will a Biden administration mean for Canada?"},"content":{"rendered":"<h4>What would a Biden administration mean for Canada?<\/h4>\n<p>President-elect Joe Biden will likely have to work with a Republican-controlled Senate when his administration takes over early next year, although runoff elections in Georgia in January could still deliver a majority to the Democrats. The extent to which the Democrats control Congress will help determine how much of the Biden administration\u2019s agenda can be implemented, at least without compromise. In the meantime, the Biden camp has begun rolling out its early policy plans.  Here\u2019s what we know: <\/p>\n<h4>Re-shoring of American supply chains? Not so fast<\/h4>\n<p>One of the top priorities in the Biden administration\u2019s early transition plan is to \u201censure the future is made in America.\u201d That will raise concerns that Canada could be shut out of U.S. government procurement. Canada is covered by the WTO\u2019s Agreement on Government Procurement (GPA), which aims for open procurement markets. But that doesn\u2019t mean Canadian exporters would be immune to a \u201cMade in America\u201d procurement policy. One only has to look back at the 2009 American Recovery and Reinvestment Act, put in place by the Obama-Biden administration to help the U.S. recover from the last big recession. The ARRA included significant \u201cBuy America\u201d provisions that created barriers for Canadian firms. In early 2010, Canada obtained an exemption from Buy American rules, but only after an intensive effort to convince the Obama administration that those rules were detrimental to our interconnected economies. <\/p>\n<p>Another Biden goal, encouraging the reshoring of private-industry supply chains, will be hard to accomplish quickly. To be sure, the pace of globalization was already slowing pre-Covid, but problems sourcing medical PPE early in the pandemic underscored how difficult it is for supply chains to adjust to a major shock. Decades of increasing global trade flows have left highly integrated cross-border supply chains that would be time-consuming and expensive to disentangle, and that is especially true across the U.S.-Canadian industrial sectors. <\/p>\n<h4>Narrowing Canada\u2019s immigration advantage<\/h4>\n<p>The Trump administration\u2019s immigration policies were perceived as giving an edge to Canada in attracting skilled immigrants from some regions. A Biden administration would increase competition for global talent, and come just as Canada has set ambitious immigration targets for the next three years to make up for a dramatic Covid-related falloff this year. The Biden campaign has pledged to lift the temporary suspension of H-1B visas, which are used extensively by the tech sector. It also aims to enable certain regions to petition for additional immigration visas \u2013 similar to the Canadian provincial nominee program. PhD students in STEM programs would be exempted from visa limits and given automatic green cards. The extent to which the Biden administration will be able to enact changes in immigration policy will depend on which party controls the Senate. But it\u2019s clear the Biden administration will be more open to immigration, creating a more competitive environment for Canada. <\/p>\n<h4>The return of some predictability in international trade policy<\/h4>\n<p>Control of Congress is still important to the President\u2019s ability to implement a trade agenda, although the Trump administration demonstrated that significant measures can be implemented by unilateral presidential action. We expect President-elect Biden to follow a more traditional path to enacting trade policy. That doesn\u2019t mean trade tensions will disappear. Tariffs on Chinese imports are likely to remain, although the odds of further constructive negotiation will be higher than under the Trump presidency. For Canada, a positive campaign message from the Biden camp was the pledge to avoid picking fights with allies. The U.S. is also expected be more of a constructive participant in multilateral forums like the WTO. All signs point to Canadian exporters being able to operate against a more predictable international trade backdrop. <\/p>\n<h4>Wary Alberta eyes fate of Keystone XL<\/h4>\n<p>A Biden administration has pledged to re-enter the Paris climate agreement and take a more aggressive role in policies to curb greenhouse gas emissions. As part of his environmental plan, Biden has pledged to revoke permits for the U.S. portion of the long-delayed Keystone XL pipeline project. But the overall outlook for oil production looks a lot different than it did a few years ago, when President Trump approved the project. Canadian oil &#038; gas investment has never recovered from the 2015 oil-price collapse, and was running 80% below 2014 levels as of Q2 2020. The Trans Mountain Pipeline expansion project (now owned by the federal government) and Enbridge\u2019s Line 3 expansion are both moving ahead. Although all three pipelines are probably not needed in the near-term, further delays in building pipeline capacity would be yet another disappointment for Alberta \u2013 particularly given the provincial government\u2019s significant financial stake in the Keystone XL. Biden has also signaled he will seek to re-enter the Iran nuclear deal, which could marginally lower the price of oil. But he\u2019s likely to take a more hawkish regulatory approach to U.S. domestic oil &#038; gas production, which at the margin could improve the relative attractiveness of investment in the Canadian energy sector. <\/p>\n<h4>Awaiting Senate clarity to determine outlook for stimulus, taxes<\/h4>\n<p>A Biden administration\u2019s ability to impose tax-and-spend policy will depend on who controls Congress. If the Republicans ultimately end up holding the Senate, it would clearly limit the ability of a Biden administration to push through a promised partial reversal of President Trump\u2019s corporate tax rate cut \u2013 to 28% from 21% &#8212; and to boost taxes on those earning more than US$400,000 per year. <\/p>\n<p>A Republican Senate is also likely to fall out of love with deficits and debt once in opposition. That will likely constrain the size of fiscal stimulus.  <\/p>\n<hr>\n<div class=\"rds-callout-white\" style=\"border: 1px solid #c4c8cc;\">\n<div class=\"rds-gcw\">\n<div style=\"display:inline-block; vertical-align: top;\" class=\"img w-mob-100\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.rbc.com\/en\/economics\/wp-content\/uploads\/sites\/23\/2025\/03\/econ-download.png\" alt=\"\" width=\"261\" height=\"177\" class=\"alignleft size-full wp-image-23215\" \/><\/div>\n<div class=\"rds-inline pad-hlf\" style=\"display:inline-block; vertical-align: top;\">\n<h4 class=\"mar-t\">Read report PDF<\/h4>\n<p><a class=\"btn tertiary\" role=\"button\" href=\"https:\/\/royal-bank-of-canada-2124.docs.contently.com\/v\/what-will-a-biden-administration-mean-for-canada-report\" target=\"_blank\" rel=\"noopener noreferrer\" data-dig-id=\"TNL_077\" data-dig-category=\"TNL Economics\" data-dig-action=\"mid-funnel click\" data-dig-label=\"What will a Biden administration mean for Canada PDF\">Download<\/a>\n<\/div>\n<\/div>\n<\/div>\n<p>\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"<p>RBC Economics looks at the early Biden policy plans and explores what a Biden presidency would mean for Canada in areas such as trade and immigration.<\/p>\n","protected":false},"author":271,"featured_media":795,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"advgb_blocks_editor_width":"","advgb_blocks_columns_visual_guide":"","footnotes":""},"categories":[83,82,84],"tags":[11,15,16,24],"class_list":["post-798","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-canadian-analysis","category-featured-analysis","category-insights","tag-economy","tag-energy","tag-environment","tag-trade"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.7 (Yoast SEO v26.8) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ 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href=\"https:\/\/www.rbc.com\/en\/economics\/category\/canadian-analysis\/\" class=\"advgb-post-tax-term\">Canadian Analysis<\/a>","<a href=\"https:\/\/www.rbc.com\/en\/economics\/category\/canadian-analysis\/featured-analysis\/\" class=\"advgb-post-tax-term\">Featured Analysis<\/a>","<a href=\"https:\/\/www.rbc.com\/en\/economics\/category\/canadian-analysis\/featured-analysis\/insights\/\" class=\"advgb-post-tax-term\">Insights<\/a>"],"unlinked":["<span class=\"advgb-post-tax-term\">Canadian Analysis<\/span>","<span class=\"advgb-post-tax-term\">Featured Analysis<\/span>","<span class=\"advgb-post-tax-term\">Insights<\/span>"]},"tags":{"linked":["<a href=\"https:\/\/www.rbc.com\/en\/economics\/category\/canadian-analysis\/featured-analysis\/insights\/\" class=\"advgb-post-tax-term\">Economy<\/a>","<a href=\"https:\/\/www.rbc.com\/en\/economics\/category\/canadian-analysis\/featured-analysis\/insights\/\" class=\"advgb-post-tax-term\">Energy<\/a>","<a href=\"https:\/\/www.rbc.com\/en\/economics\/category\/canadian-analysis\/featured-analysis\/insights\/\" class=\"advgb-post-tax-term\">Environment<\/a>","<a href=\"https:\/\/www.rbc.com\/en\/economics\/category\/canadian-analysis\/featured-analysis\/insights\/\" class=\"advgb-post-tax-term\">Trade<\/a>"],"unlinked":["<span class=\"advgb-post-tax-term\">Economy<\/span>","<span class=\"advgb-post-tax-term\">Energy<\/span>","<span class=\"advgb-post-tax-term\">Environment<\/span>","<span class=\"advgb-post-tax-term\">Trade<\/span>"]}},"comment_count":"0","relative_dates":{"created":"Posted 5 years ago","modified":"Updated 5 years ago"},"absolute_dates":{"created":"Posted on November 10, 2020","modified":"Updated on November 10, 2020"},"absolute_dates_time":{"created":"Posted on November 10, 2020 3:40 pm","modified":"Updated on November 10, 2020 3:40 pm"},"featured_img_caption":"","series_order":"","_links":{"self":[{"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/posts\/798","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/users\/271"}],"replies":[{"embeddable":true,"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/comments?post=798"}],"version-history":[{"count":0,"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/posts\/798\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/media\/795"}],"wp:attachment":[{"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/media?parent=798"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/categories?post=798"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.rbc.com\/en\/economics\/wp-json\/wp\/v2\/tags?post=798"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}