Alberta’s Growing Conversation on International Matters

After a short constituency week break, Alberta’s MLAs have returned to the Assembly to hunker down for the home stretch of the fall sitting period – currently scheduled to conclude around December 5, 2024. Over the next three weeks, the Legislature will be working hard to try and pass (at least) the 14 pieces of legislation that will have been introduced before the holiday break.

No, the government does not have to pass all the bills introduced before the break; however, it is quite possible that we could see a Speech from the Throne when the Legislature reconvenes in February. It is not a guarantee that we will see one and many factors will be going into determining that (such as the legislation proposed that impacts the Electoral Boundaries Commission), but that is the task ahead of this government if it chooses to go that route.

While things are going to heat up once again in the Assembly, we turn our eyes outward to a more international focus. Of course, Alberta politics is not limited to our small prairie bubble in western Canada; rather, we exist in the same international ecosystem as everyone else. The actions taken in that ecosystem have consequences here at home, so we decided to dedicate some time to exploring international issues as they have become increasingly relevant in recent weeks.

Alberta Joins United States Energy Pact

It is known how critical our province’s energy trade with the United States is to our own economic health. Although our trade is not limited to the oil and gas sector, our province’s exports account for more than half of all oil imports made by our southern neighbours.

Last week, Premier Danielle Smith announced the next step in promoting energy security for our province by signing onto the newly renamed Governors’ Coalition for Energy Security. Alberta becomes the 13th signatory to the pact, joining Louisiana, New Hampshire, Indiana, Alabama, Georgia, Tennessee, South Dakota, Mississippi, Arkansas, Oklahoma, Wyoming, and Virginia. Alberta is the first Canadian province to join.

“With 200 billion barrels of recoverable oil, 200 trillion cubic feet of recoverable natural gas, significant natural gas liquids and ample pore space for carbon capture, Alberta’s contribution is set to grow even further as we look to work with the Trump Administration and other U.S. partners to increase our pipeline capacity to our greatest friend and ally, the United States.”

The move was not just symbolic, but very much strategic move to build an internal ally network within the United States political ecosystem. With the implications of Donald Trump’s isolationist policies proposed during the recent presidential election not yet fully known (more on that later), Alberta does potentially face challenges.

A quick look at the states included in the Governor’s Coalition for Energy Security reveals that each state is home to a Republican governor. The benefit of Alberta being at the table with this group is that the Premier now has allies that can help the incoming government understand the economic importance of Canadian oil and; thus, hopefully avoid the wide-spread tariffs that has been promised by Trump and his team.

The other consideration to bear in mind regarding Alberta’s oil and gas sector is the very likely prospect of the United States ramping up production to lessen the need for imported oil (like ours). While that may produce positive short-term results like a lower bill at the gas pump, it also could have a damaging impact on our local oil and gas sector as demand for Canadian produced oil will likely drop.

If the United States government increases local production and slaps a 10-20 per cent tariff on Alberta oil, the results could be economically devastating. Hence, now is the time for the Premier to begin strengthening energy ties with our neighbours.

Mexico’s Involvement in Free Trade

Premier Smith recently voiced strong support for restructuring the North American free trade framework, advocating for a bilateral agreement between Canada and the United States that excludes Mexico. Smith emphasized her stance during recent discussions, stating she is "a thousand per cent" in favor of pursuing this trade strategy.

Her position aligns with Ontario Premier Doug Ford's recent comments urging Canada to consider a bilateral trade agreement with the U.S. Premier Ford's suggestion stems from concerns about Mexico's trade practices, particularly its growing economic ties with China. Premier Smith echoed these sentiments, stating that Mexico's engagement with Chinese investments is "hollowing out the manufacturing sector in both America as well as Canada." She emphasized the need for a "Canada-first approach" in trade negotiations to address these challenges.

Premier Smith highlighted Alberta's significant trade relationship with the United States, which far outweighs its economic exchanges with Mexico. According to her, Alberta conducts $188 billion in trade with the U.S., compared to just $2.9 billion with Mexico.

In speaking with CBC, Premier Smith said "the question is: why would we support continuing in a trilateral agreement if it's going to be imbalanced that way? We really should be looking at two bilateral agreements."

The discussion comes as the United States-Mexico-Canada Agreement (USMCA), the successor to NAFTA, is set for review in 2026. Donald Trump has also indicated plans to reopen the agreement, creating potential opportunities for renegotiation. Both Smith and Ford's comments reflect a broader concern about how Mexico's trade dynamics could impact Canadian industries, particularly amid global shifts in manufacturing and economic partnerships.

While some see the potential for Canada and the U.S. to forge stronger bilateral ties, others caution against dismantling the trilateral framework, which has facilitated decades of economic cooperation across the continent.

As the 2026 USMCA review approaches, these trilateral discussions will shape Canada's approach to trade negotiations, influencing not only Alberta's economic landscape but also the broader North American trade dynamic.

Dealing with Trump’s Upcoming Isolationism

Throughout the course of the United States presidential campaign, Donald Trump promised many things – including a revision of how their government will play in the international sandbox. Part of that includes rethinking the United States’ involvement in foreign affairs and military alliances as well as how their government handles immigration.

Of course, one of the most controversial and potentially damaging pieces of Trumpian policy proposals ties back to applying tariffs of 10-20% on all imported goods to the United States. While there is hope Alberta oil may be granted an exemption (as per earlier sections of this article), there remain far-reaching implications for our other exports. Beyond oil and gas, we export significant amounts of other natural resources (like softwood lumber and pulp) as well as agricultural products (such as Alberta beef, livestock, canola, and other products).

That does not capture all our exports, but it demonstrates the need to ensure Alberta’s economy is guarded against Trumps economic isolationism.