Quebec Industry and U.S. Protectionism: Planning Ahead to Adapt Successfully

Note: This article was written before the November U.S. presidential election, but the insights remain relevant given the ongoing economic and political uncertainties.

With political uncertainty rising in the United States, Quebec’s manufacturing sector must brace for new challenges. As the U.S. presidential election approaches in November 2024, the growing push for economic protectionism is sparking valid concerns across our industries. Let’s take a closer look at the key risks and opportunities ahead.

The Changing Landscape of Cross-Border Trade

No matter which party wins the election, one thing is certain: Buy American is no longer just a slogan—it’s a deeply embedded political stance. Both Democrats and Republicans have made it clear they want to repatriate industrial production to U.S. soil, a trend that has been gaining momentum for years, particularly with the Reshoring Initiative launched in 2010.

This shift poses significant challenges for Quebec, where 71.8% of international merchandise exports were sent to the U.S. in 2022, according to the Institut de la statistique du Québec. Industries that rely heavily on exports—such as aluminum, aerospace, transportation equipment, and forestry products—must prepare for major changes, as some manufacturers send up to 80-90% of their production south of the border.

How Supply Chains Will Be Affected

Protectionist policies in the U.S. introduce three key challenges for Quebec manufacturers:

• More complex regulations – Stricter traceability requirements and additional documentation to prove the origin of materials and components.
• Rising cost pressures – Potential demands to relocate parts of production to the U.S. to meet local content requirements.
• Uncertainty in long-term planning – Political volatility makes it difficult to commit to large-scale investments.

Opportunities to Seize

Despite the challenges that may arise from the election outcome, new opportunities are emerging:

• Expanding into new markets – Now is the time to strengthen Quebec’s presence in global markets, particularly in Europe, by leveraging the Comprehensive Economic and Trade Agreement (CETA).
• Accelerating the shift to Industry 5.0 – Investing in digital transformation, sustainability, and human-centered innovation will help manufacturers stay competitive, even in the face of protectionist pressures.
• Moving up the value chain – Instead of competing on cost alone, Quebec manufacturers can differentiate themselves through innovation, advanced technologies, and superior product quality.

Conclusion

Quebec’s manufacturing sector has long proven its resilience and adaptability. Rather than viewing U.S. protectionism as a threat, businesses must approach these shifts as an opportunity—not as passive observers of change, but as architects of forward-thinking solutions.

With geographical proximity, recognized industry expertise, and a highly skilled workforce, Quebec manufacturers have strong competitive advantages. By anticipating shifts and proactively adapting, the sector can turn these challenges into new pathways for growth, innovation, and long-term success.