Why is Canada winning the travel trade war with the US?
Canada is still in the grip of a trade war with the United States. Trade uncertainty and US tariffs on some Canadian goods like aluminum and steel continue Threat to Canada’s economy,
However, there is one area where Canada is emerging as the clear winner: tourism.
US President Donald Trump’s divisive politics, tariffs and increased border security have helped lead to a decline in international tourism spending in the US.e, surveys and industry experts suggest an increase in Canadian patriotism and perceptions about Canada A safe and friendly destination has helped drive a record-breaking summer for tourism in the country.
“Because they’re raising the barriers, it makes it more challenging to go to the United States, so you start looking for options and Canada is a reasonable option,” he said. wayne smith, Director of the Institute of Hospitality and Tourism Management at the Metropolitan University of Toronto.
“In this case, Canada had a tremendous advantage.”
Loss of Canadian tourism dollars to the US
The Trump administration had suggested that 2025 would be a banner year for tourism. The US International Trade Administration announced in August that for the first six months of 2025, year-over-year international visitor spending rose 2.2 percent,
“President Trump has revitalized our country,” Commerce Secretary Howard Lutnick said in a statement at the time. “With President Trump’s focus on historic richness and public safety, people from around the world are coming to visit in record numbers.”
But the number of Canadian tourists in the country is continuously declining. Which started when Trump took office in late January And started its own trade war, which eventually started having an impact.
Overall, between February and October, the number of return trips by Canadians to the US declined21 percent for air travel and a surprising 33.5 percent for L.and travel, according to Statistics Canada data provided to CBC News.
The US Travel Association, a nonprofit industry organization, now paints a less-than-stellar picture for 2025: it predicts 3.2 percent decline in international tourism expenditureng in the US compared to 2024 – a loss of US$5.7 billion.
The association blames the decline primarily on fewer Canadian tourists. Canadians traditionally make up the largest group of international visitors to the U.S., accounting for 28 percent of the total. 72.4 million visitors in 2024,
“The lack of Canadian tourism is devastating us, especially our border communities,” said Laurie Trotman, director of the Border Policy Research Institute at Western Washington University in Bellingham, Washington.
She notes that the decline in spending comes just a few years after a sharp decline in tourism during the COVID-19 pandemic.
“Many of those businesses got back on their feet and now they’re back on their feet again,” Trautman said. “So it’s an incredible cost.”
Canadian travel to the United States has declined sharply since President Donald Trump took office earlier this year. Andrew Chang analyzes the numbers to explain the impact on the US economy and how many American businesses are trying to win back Canadians. Images provided by The Canadian Press, Reuters and Getty Images
New one angus reid pole There are suggestions that the Trump administration played a central role in the decline. Of the 1,607 Canadians surveyed in late October, 77 per cent said they viewed the US as a travel destination more negatively this year than in previous years.
The top reasons respondents gave for staying away from the country included a pledge to stand up for CainADA (in response to the trade war and Trump calling Canada the 51st state), aThe second concern is about America’s political environment and border security.
Those concerns have been further heightened Strict entry rules for some Canadian visitorsThe Many foreigners were detained recently on the American border and dramatic video US Immigration and Customs Enforcement (ICE) is shown arresting people as part of Trump’s immigration crackdown.
“Tourism is largely a safety-based industry,” Smith said.
“(Canadians) are not sure if they will have to take their passport with them because of ICE when they cross the border,” he said. “Add to this some political components, and America looks like a destination that people will turn away from.”
Canada’s tourism boom
America’s loss has become Canada’s gain, as many Canadians and foreign visitors chose to spend their holiday dollars north of the 49th parallel this year.
destination canada, Country’s tourism organization, Estimates of total tourism revenue year-on-year For The lucrative summer season of May to August brought an unprecedented $3.3 billion (six percent) increase.
Part of that boost came from domestic tourism, which increased by seven percent.
“You’ll find a lot of people who are looking (at the U.S.) and thinking, ‘I can live in Canada and make a really positive contribution to Canadian society,'” Smith said. “You had a perfect kind of storm to really and powerfully increase domestic tourism in Canada this year.”
The Angus Reid poll supports this. of 1,075 Canadians surveyed by Angus Reid in early June26 percent said they changed, postponed or canceled U.S. travel plans this year. Of those respondents, the majority said they either chose to travel within their province (44 per cent), or to travel to another Canadian province (30 per cent).
The survey was launched by MonerisA Canadian payment processing company.
This past summer will be memorable for many hotels and tourist attractions across the country. CBC’s Kyle Box reveals new figures that show the tourism industry has reached an all-time high despite a drop in revenue from U.S. visitors.
Fewer Americans visited Canada this summerThat led to a 1.7 per cent decline in their tourism dollars, Destination Canada data shows. But an increase in foreign tourism helped offset this.
Year-over-year data provided by Statistics Canada shows the number of foreign tourists to Canada increased by 2.4 per cent between May and August. And according to Destination Canada, their spending increased by 10.4 per cent.
One online survey The count of 1,560 people in the UK, France and Germany in May shows that the Trump administration has affected their travel patterns.
More than half (52 per cent) said they were more likely to move to Canada because of the current political climate in the US. Additionally, more than 90 percent said they view Canada as a friendly and safe place to visit.
The survey was conducted by Context Research Group (CRG), the research partner of Destination Ontario, Ontario’s travel organization. After some time the respondents were polled many germansPlus a welsh backpacker were dayTension at the US border, and Trump Europe threatened with sweeping tariffs,
“We are a direct beneficiary of the political climate that is taking place in America right now,” said William Shatton, co-founder of GRG.
“Canada is seen as a top destination for (Europeans) right now because there is a sense of safety and security, and is friendly.”
Many Canadian snowbirds who crossed the US land border were told they needed to be photographed and fingerprinted as part of the new registration process.
What about 2026?
US Travel Association estimates international travel will rebound in 2026 due to US hosting fifa world cup football game in summer, and the celebration of the country’s 250th anniversary.
The travel association has also expressed concern about a new rule introduced by the Trump administration that could further hinder tourism.
America is planning to implement $250 “Visa Integrity Fee” For visitors who require a non-immigrant visa to enter the country.
This means Canadian citizens will be exempt, but Canadian permanent residents and Mexican citizens will not. The second largest group of visitors to the US in 2024 were Mexicans, with 72.4 million visitors. Total 23.5 percentCanada is also hosting FIFA World Cup game.
visitors May be able to collect refund Once their visas expire, there are few details on how the process will work.
“Increasing fees on legitimate international visitors amounts to a self-imposed tariff,” said Geoff Freeman, president and CEO of the US Travel Association. In a statement in July,
“These fees… do nothing but discourage travel at a time when foreign travelers are already concerned about the welcoming experience and high prices.”
