The snow was still melting in Yellowknife when the three territorial premiers gathered last week to discuss a challenge that has long frustrated northern businesses and consumers alike: persistent internal trade barriers that disproportionately impact Canada’s North.
“We’re not asking for special treatment – we’re asking for fair treatment that recognizes our unique geographic and economic realities,” Yukon Premier Ranj Pillai told me during a brief interview following the Northern Premiers’ Forum in Yellowknife.
The territorial leaders issued a joint communiqué calling on the federal government to create northern-specific exemptions within the Canadian Free Trade Agreement (CFTA), arguing that the current framework fails to account for the vastly different economic conditions facing their regions.
Their timing is strategic. With the federal government’s promise to modernize the CFTA this year, northern leaders see an opportunity to address longstanding concerns about how national trade policies affect their communities.
Northwest Territories Premier Caroline Cochrane didn’t mince words. “When regulations and trade frameworks are designed in Ottawa or provincial capitals, they rarely consider the reality that a community of 500 people in the Arctic faces wildly different challenges than a city of millions in southern Canada.”
The numbers support their concerns. According to a recent Conference Board of Canada study, northern households pay between 28-86% more for a basic food basket compared to southern Canadians, with transportation costs accounting for a significant portion of that difference.
Internal trade barriers only compound these challenges. Restrictions on professional licensing, differing provincial product standards, and complex procurement rules create inefficiencies that hit northern communities hardest.
Nunavut Premier P.J. Akeeagok pointed to a telling example. “A construction company in Iqaluit might need to navigate three separate regulatory regimes just to do business across the territories. That’s time and money that gets passed on to communities already struggling with affordability.”
These inefficiencies come with a staggering price tag. The International Monetary Fund estimates that removing internal trade barriers could add $80 billion annually to Canada’s economy – almost 4% of GDP. For northern regions with limited economic opportunities, the stakes are particularly high.
Business leaders across the North have rallied behind the premiers’ call. Keith Halliday, president of the Yukon Chamber of Commerce, sees these barriers as an existential issue for northern enterprises.
“When you’re operating in a market of 40,000 people like Yukon, you need access to broader markets just to achieve basic economies of scale,” Halliday explained. “The current system forces many businesses to duplicate certifications, registrations, and processes for each jurisdiction they want to serve.”
Federal Minister of Northern Affairs Dan Vandal acknowledged the concerns but stopped short of committing to northern-specific exemptions, saying only that “the unique circumstances of the territories will be taken into consideration” in upcoming CFTA modernization talks.
The territorial leaders aren’t asking for complete exemption from trade rules, but rather for recognition that one-size-fits-all approaches don’t work for the North. They’re proposing targeted adjustments that would maintain consumer protections while reducing unnecessary regulatory duplication.
“It’s about pragmatic solutions,” Premier Pillai emphasized. “For instance, allowing professionals licensed in one territory to work across all three without additional red tape, or harmonizing building codes to reflect northern construction realities.”
Critics suggest such exemptions could undermine the purpose of a national free trade agreement. “The goal should be to eliminate barriers for everyone, not create a patchwork of exemptions,” said Ryan Manucha of the C.D. Howe Institute in a recent policy brief.
But northern advocates counter that treating unequal regions equally only perpetuates existing disadvantages. “What works in Toronto or Montreal simply doesn’t translate to Inuvik or Rankin Inlet,” said Jessica Thompson of Alternatives North, a Yellowknife-based social justice coalition.
Recent polling from Abac
