Inflation stays stable in May, reflecting slow economy

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The Consumer Price Index rose 1.7% on a year-over-year basis in May, matching the 1.7% increase in April, Statistics Canada said.

Compared to the same month last year, slower paced increases to rent and a decline in travel tours put downward pressure on inflation this May.

“After last month’s uptick in core inflation some giveback was expected. The labour market remains soft and tepid domestic demand growth should keep a lid on inflationary pressures,” TD Director and Senior Economist Andrew Hencic said. “As has been the case this year, the outlook is heavily dependent on how trade negotiations evolve, but we believe that the soft economic backdrop should give the BoC space to deliver two more cuts this year.”

C-5 aims to rebuild Canada’s economic momentum

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An economic evolution that the national chamber network has been working on for years is one step closer to reality this week. On June 23, the federal government passed legislation to vastly improve free trade and labour mobility between provinces.

Without this legislation, large-scale energy and infrastructure projects have routinely been delayed by regulatory gridlock, rising costs and political indecision.

“The Canadian Chamber of Commerce applauds the federal government for urgently introducing and passing Bill C-5 in the House of Commons,” Canadian Chamber Executive Vice President and Chief of Public Policy Matthew Holmes said, adding the ongoing tradewar with the US administration drove home the need to diversify. “We cannot have all our eggs in the United States economic basket any longer.”

Projects where fast-tracking has the broad support of impacted First Nations, Métis and Inuit communities should be the first to be considered.

“Canada’s business community firmly believes we can end project paralysis while working in collaboration with Indigenous rights holders and communities while maintaining world-class environmental standards,” Holmes said. “We know respect and partnership for shared prosperity are the path forward. The Canadian Chamber does not believe a major project is viable in the absence of clear community level support and expects Canada to meet its legal obligations to consult and cooperate with Indigenous peoples, per the United Nations Declaration on the Rights of Indigenous Peoples Act adopted in 2021.”

Bill C-5 is just the first step. The onus is now on the federal government to deliver so that we can build economic momentum in Canada and show the world we’re serious about growth, energy and getting big things done.

Municipalities applaud expanded borrowing powers

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Municipalities in BC are applauding a move to make it easier to finance capital projects. The Chamber is cautiously optimistic about the change, though businesses are wary of enabling any level of government to take on more debt.

“There’s no question that we want to see the public sector work more efficiently, but we also are clear that we need investments that help the private sector grow our economy,” Chamber CEO Bruce Williams said. “Innovation led by business is key for us to create the good jobs and creative solutions needed to solve many of the issues affecting our society that government itself is unable to fix.”

The Province amended the municipal liabilities regulation and the short-term capital borrowing regulation to give municipalities more flexibility to plan and finance infrastructure projects that support population growth and housing development.

Municipalities can now borrow up to 10% of their annual revenue, without having to hold a public vote. The changes are a response to concerns raised by municipalities about the cost, complexity and risk of delays associated with implementing capital projects.

Construction begins in Inner Harbour on Belleville terminal

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Construction on the Belleville Ferry Terminal will begin this month, following the awarding of a design-build contract.

The Chamber has called for the new terminal for decades and, once complete, it will provide a more comfortable experience for people travelling to downtown Victoria by ferry.

“The Chamber has been an outspoken proponent for modernizing Belleville terminal for decades, and we’re happy to see the project meet new milestones along its way to completion,” Chamber CEO

Bruce Williams said. “With so much uncertainty affecting the economy, we support this project as an important investment in the future of Greater Victoria and as a confirmation of the value the Clipper and Coho bring to our region.”

Construction involves demolishing existing infrastructure and building a new pre-clearance terminal building with modern border-security standards. It also includes replacing aging wharf facilities and building a new commercial goods processing facility.

The new pre-clearance terminal will comply with the Canada-US Land, Rail, Marine and Air Transport Preclearance Agreement, and will make travel faster and easier by allowing passengers to complete the customs and immigration process in Victoria prior to disembarking in the US.

The overall project cost has increased from the $331 million budget that was approved in 2024, due to complex geotechnical and seismic conditions, site constraints and significant soil contamination that will require extensive remediation. Other factors include inflation and safeguarding against economic uncertainty related to tariffs on steel and other products. The federal government has confirmed it will increase its contribution to more than $45 million for the project. The new cost of the project is $416 million.

The project is expected to be completed in 2028.

New trail crossing at Tillicum will ease commute time

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Commuters will have an easier time crossing Tillicum Road at Highway 1, once a new trail crossing opens for summer 2027.

The province released illustrations on June 13 of the planned 100-metre Tillicum Active Transportation Bridge. Work is expected to begin in early 2026.

Once complete, the bridge will eliminate one of the last signalized crossings on the Galloping Goose Trail between downtown Victoria and the Westshore. More than 3,000 people use this section of the trail every day in the summer.

Report calls for changes to ease port labour disputes

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The federal government has released a report on Canada’s West Coast ports, including recommendations to protect critical supply chains.

The Industrial Inquiry Commission on West Coast Ports found that changes need to be made to reflect the increasing importance of global supply chains on our economy.

“The strain on Canada’s supply chains has been compounded over recent years by repeated labour disruptions, resulting in 2023 holding the unfortunate record of most working days lost since 1986,” Canadian Chamber Vice-President Pascal Chan said. “As our economy contends with a productivity crisis, Canadian businesses cannot afford these continual major trade infrastructure shutdowns that prevent them from reliably delivering the goods.”

The impact of recent labour disputes has had serious implications on Greater Victoria and Vancouver Island, as we are dependent on the flow of goods for our food security as well as many of our livelihoods.

Work continues on reducing internal trade barriers

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With less than two weeks to go for Canada’s new Prime Minister to meet his promise of reducing barriers to inter-provincial trade, the national chamber network is encouraging lawmakers to move quickly.

On Monday, the Canadian Chamber appeared before a Senate committee to highlight the urgent need to reduce internal trade barriers and accelerate the development of critical infrastructure across Canada. The delegation also reiterated Canada’s role in ensuring energy security, supporting Indigenous partnerships and restoring investor confidence through regulatory reform.

The government has said that removing internal trade barriers would reduce prices by up to 15% and add up to $200 billion to Canada’s economy. According to Scotiabank, there is a lot to understand the impact removing inter-provincial trade barriers could have on our economy.

“The (barriers) are basically a lot of these small differences in regulatory standards that just make it that much more difficult to trade internally. When we think about trade barriers, often we think about them as anything that makes trading more difficult,” Scotiabank’s Senior Policy Advisor John McNall said. “They can be these little unintentional frictions that add up over time. For example, think of a nurse or an electrician who’s working in a particular province, they’re licensed to work in one province. But if they want to move over to another one, their licence doesn’t necessarily carry over. These sorts of little technical standards or regulatory changes create extra costs for businesses. None of these laws are created maliciously, the province is implementing what it feels is best for business in that jurisdiction, but they become an issue when regulations are different between provinces.”

Armed Forces funding good news for Greater Victoria

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Last week, the Canadian Chamber took part in the federal government’s announcement that Canada is investing in rebuilding our Armed Forces. The move is expected to help the economy, especially in communities such as Greater Victoria that are home to significant Armed Forces infrastructure.

“Canada has a long and proud history of remarkable military and peacekeeping achievements around the world. From NORAD to Operation UNIFIER in Ukraine, to defeating forest fires here at home, Canada’s military personnel have stepped up and defended Canada and Canadian interests in extremely difficult and dangerous conditions,” Canadian Chamber CEO Candace Laing said. “The inclusion of cyber security and year-round Canadian presence in the Arctic as key features reflects the global reality we live in.”

While there was no specific mention of bases such as CFB Esquimalt, the government did promise to improve pay for Armed Forces personnel. More than 4,000 currently are based out of CFB Esquimalt.

Prime Minister Mark Carney said Canada will achieve NATO’s 2% this year — half a decade ahead of schedule – promising more than $9 billion invested in 2025-26.

“In addition to making Canadians and Canada safer amidst rising geopolitical uncertainty, these investments signify that we are serious about securing and protecting our trade relationships and the global supply chains that we play a pivotal role in,” Laing said. “As global threats evolve, so must we. The Canadian business community stands ready to support achieving this vital national mission.”

Saanich launches new BusinessCare program

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The District of Saanich announced a new initiative aimed at business retention and engagement. The municipality hopes the program will lead to business growth and economic resiliency.

Saanich BusinessCare involves quick, in-person visits by Saanich’s Economic Development Office so that staff better understand how policies and programs affect businesses in the District.

“As our economy changes, helping businesses remain competitive and resilient is more important than ever,” Saanich Mayor Dean Murdock said in a media release. “Engaging directly with local businesses will enable the District to create a stronger, more supportive and connected business environment.”

Through one-on-one engagement and relationship-building, the program hopes to help policy makers provide the support needed to help businesses thrive.

“The Saanich BusinessCare program will help address the dynamic needs of businesses within our community,” Saanich’s Economic Development Manager Mitchell Edgar said. “Over the coming months, our team will be meeting with Saanich business owners and management to better understand the unique challenges and opportunities each organization is dealing with.”

Panel releases plan to make Victoria safer for business

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How can we make our communities safer? It’s a fundamental question that speaks to the very foundation of our region’s economy.

On June 19, the City of Victoria will consider the Community Safety and Wellbeing Plan that was created through the input of a 10-person panel that began meeting 18-months ago.

“We know Chamber members want more done to protect businesses, as well as helping those who are facing mental health and addiction challenges,” Chamber CEO Bruce Williams said. “We’re happy that the panel included people who were able to provide an important perspective from the business community.”

The plan focuses on the need to invest in prevention rather than chasing problems after they manifest. This approach requires support from higher levels of government, even though the municipality is often on the frontline.

“Underpinning many of the recommendations is the knowledge that local government is the closest to the issues and the most attuned to the needs of its own community,” the plan states. “Local governments are highly adaptable in addressing emerging issues, and responding quickly and efficiently. Additionally, key resources for community safety and wellbeing such as parks, public works, protective services, urban planning, and business development are already part of the City’s municipal framework and can adapt to emerging community needs.”

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