RAC: ‘Efficient Transport Networks Support Export Growth’

Why It Matters

Diversifying away from the United States reduces economic vulnerability and positions Canada as a more resilient global exporter, while targeted rail and port investments unlock significant GDP growth.

Key Takeaways

• Canada aims to double non‑U.S. exports to $444 billion by 2034
• $5 billion needed for trade corridors and $1 billion for Arctic infrastructure
• Rail moves $296 billion of goods annually, supporting export growth
• Labor disruptions cost 1.3 million workdays; stability essential
• Accelerated depreciation and short‑line tax credits proposed to attract private capital

Pulse Analysis

Canada’s export strategy is undergoing a seismic shift as policymakers seek to halve the country’s reliance on the United States. The Railway Association of Canada (RAC) argues that achieving a $444 billion target for non‑U.S. trade will require a coordinated upgrade of freight‑rail corridors, port facilities and Arctic routes. Recent data show a 71% nominal rise in total exports from 2014‑2024, driven largely by services, but goods exports have lagged, underscoring the need for more efficient land‑to‑sea logistics. By investing roughly $5 billion in trade corridors and $1 billion in Arctic infrastructure, the government could generate up to $15.5 billion in additional GDP, according to RAC’s estimates.

Rail remains the backbone of Canada’s export ecosystem, with 27,000 miles of freight lines moving about $296 billion of commodities each year. Capital spending hit $26.3 billion between 2015‑2024, and $3.3 billion was allocated in 2024 alone, reflecting confidence in rail’s role for grain, minerals and energy shipments. Yet bottlenecks persist; the Port of Vancouver’s Roberts Bank expansion has stalled, delaying high‑value cargoes. Meanwhile, the Arctic’s under‑developed network limits access to northern resources, prompting calls for dedicated funding. Enhancing rail‑port integration will not only accelerate delivery times but also diversify market access beyond the United States, especially to Europe and Asia.

RAC’s policy roadmap emphasizes private‑sector incentives and regulatory agility. Proposals include 100% immediate depreciation on new rail assets, tax credits of roughly $6,300 per short‑line mile, and faster permitting processes. Addressing labour volatility—over 60 work stoppages and 1.3 million lost workdays in 2024—is also critical to maintaining network reliability. If these measures gain traction, Canada could see a $11‑$15 billion investment influx by 2040, reinforcing its position as a competitive, diversified exporter in a geopolitically uncertain landscape.