---
title: "Gravity Always Wins: Why Diversifying Canada's Trade Is Harder Than Ottawa Admits"
description: Canada aims to double non-US exports, but a new study reveals that geographical and economic factors make this goal challenging. Investment in infrastructure is key.
---

[Economics Blog ](https://icba.ca/economics-blog)

# [Gravity Always Wins: Why Diversifying Canada's Trade Is Harder Than Ottawa Admits](https://icba.ca/economics-blog/gravity-always-wins-why-diversifying-canadas-trade-is-harder-than-ottawa-admits)

 Written by [Jordan Bateman](https://icba.ca/economics-blog/author/jordan) | Jun 11, 2026 5:13:42 PM

Prime Minister Carney has promised to double Canada's non-US exports within a decade, backed by a $10-billion Trade Diversification Corridor Fund. [A new Fraser Institute study](https://www.fraserinstitute.org/sites/default/files/2026-06/gravity-model-and-efforts-to-diversify-markets-for-canadian-exports.pdf), co-authored by ICBA Chief Economist Jock Finlayson and Senior Fellow Steven Globerman, explains why that's a steep climb.

The reason is the "gravity model" of trade — and it's exactly what it sounds like. Trade flows toward big economies that are close by. The US is the largest economy on earth, $23.8 trillion and 27% bigger than China, sitting right on our border. Seventy per cent of Canadians live within 100 km of it. Shipping from Vancouver to Los Angeles is 1,245 nautical miles; to Shanghai, it's 5,151.

The kicker: trade agreements have no measurable effect on energy and mining exports — 40% of what Canada sells abroad. Deals won't do it. Building will.

If Ottawa is serious about diversification, the money has to go into ports, rail, and pipelines — and into earning the world's trust as a reliable supplier.

Read the full study [HERE](https://www.fraserinstitute.org/sites/default/files/2026-06/gravity-model-and-efforts-to-diversify-markets-for-canadian-exports.pdf).

[View full post](https://icba.ca/economics-blog/gravity-always-wins-why-diversifying-canadas-trade-is-harder-than-ottawa-admits)

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