Five major predictions for how the world will look in 2025. Pictured: U.S. President-elect Donald Trump. Photo Credit: Donald Trump/X.
Although predicting the future has always been difficult, 2025 looks to be particularly challenging. Changes in some areas in the coming year appear to be a slam dunk, but their timing and the impact they will have on Canada are very much up in the air. Nevertheless, let’s take a stab at what will definitely be major developments in the coming months. As always, this author will revisit these predictions at year-end to see how right or wrong they were.
First: Goodbye Trudeau
One of the slam dunks is that Canadians will finally get their wish to see the back of Prime Minister Justin Trudeau in 2025. The key question is when. Unrest within the Liberal Party continues to grow and suggests the possibility of a Spring election. Yet comments by Trudeau himself suggest he could still try to hang on as long as possible until the election deadline of October 2025 is reached. In political terms, Trudeau is still relatively young and will be looking for his next job, not retirement. It’s likely that the usual post-politics positions of a corporate Board seat or law firm posting will not be available to him given his horrendous track record as Prime Minister and the fact he has few marketable skills or relevant education. A more probable landing spot will be with an international organization such as the UN where lofty honourary positions abound and very little actual work is required. Complicating that possibility is the fact that Trudeau’s global reputation is hardly stellar at present.
This year, Canada is set to take over the presidency of the G7 and host a meeting of the leaders in June 2025 in Kananaskis Alberta. Assuming Trudeau is eyeing some type of international post as his next gig, it’s hard to believe he will be able to resist this opportunity to hang around and preside over the G7 meeting in an attempt to burnish his reputation. If Trudeau does manage to hang in until June, it isn’t a stretch to think he will try to stay around until the October deadline, as there will be very little time between June and October to undertake an effective change of leadership in the Liberal Party. Trudeau hanging around as Prime Minister until October doesn’t seem like the most probable scenario, but it is possible. A key consideration is if NDP leader Jagmeet Singh follows through on his claim that he is ready to bring down the government shortly after the House of Commons returns from the Christmas break. Past experience suggests this is unlikely, but enough forces are coming together to turf Trudeau that I don’t think he’ll be around for that June G7 meeting.
Second: A sluggish economy
In economic news, 2025 will see continued sluggish GDP growth in Canada but some slight improvement over 2024 should occur as lower interest rates take hold. Real GDP growth of about two per cent is expected. Inflation will remain above the Bank of Canada’s two per cent target as a weak Canadian dollar boosts import prices and food inflation remains high. Although Canadians will see a change in government in 2025, there will not be enough time under a new government to see much of a turnaround economically even with rapid and drastic policy shifts. Government change will permit a more transparent examination of the nation’s finances than has been done in years and the situation will be even more dire than expected. A credit downgrade is likely. Despite promises to the contrary, immigration levels will remain unsustainably high, continuing to worsen housing shortages and pressure on public services such as health care and social services. Barring the remote possibility of an election early in the year, more tax increases will be piled on Canadians for things such as EI, CPP and carbon. Canada’s competitiveness will continue to deteriorate and GDP per capita, a proxy for our standard of living, will decline further in 2025.
Third: A pushback against wokeness
The push-back against a range of so-called “woke” programs such as DEI (diversity, equity and inclusion) and ESG (environmental, social and governance) will escalate as opposition increases among the general public and the business community increasingly realizes how destructive these programs are to the bottom line. While the private sector backs away from these programs, they will remain prevalent in public institutions where performance is not a major factor as they do not operate in competitive markets. Opposition to the ridiculous pro-terrorist hate-fests on our streets will finally grow to the point that politicians will be forced to react more than they have to date, but significant change won’t happen until we have a new federal government in Ottawa.
Fourth: The Trump factor and Canada
Incoming U.S. President Donald Trump will not impose across-the-board 25 per cent tariffs on Canadian products but will increase some tariffs on selected items as a warning shot across the bow to Canada to get our act together on border issues, trade irritants and drug policies. Trump’s abandonment of much of President Joe Biden’s approach within the so-called Inflation Reduction Act to promote “green” industries will have a major negative impact on Canada’s massive taxpayer investments in EV battery manufacturing facilities. Trump’s America First policies to cut the U.S. government and reduce taxes will further worsen Canada’s competitive position relative to our largest trading partner.
Fifth: A changing geopolitical landscape
Trump’s assumption of the U.S. Presidency will help to lessen geopolitical tensions in the Middle East as Trump resumes the negotiation of the Abraham Accords between individual Arab states and Israel and increases sanctions on sponsors of terror such as Iran. The impact of a second Trump presidency on the Russia-Ukraine war is one big question mark, as Trump has stated his intention to end the war quickly and has hinted he might reduce U.S. military support to Ukraine. It remains to be seen how Trump’s mercurial views toward Russia and China will impact recent aggressions by both of those countries.
The year 2025 will definitely be one of significant change, much of it welcome and long overdue. Unfortunately, the extensive damage the Trudeau government has done over the past nine years to Canada’s economy and society will not be resolved quickly, and more pain is on the horizon for Canadians as a result. But if a new federal government can implement some relatively quick changes to reduce the size of government, remove barriers to foreign and domestic business investment, relieve some of the onerous tax burden on Canadians and start to unleash the potential of our resource wealth, things will be looking up for Canada in the years ahead.
She has published numerous articles in journals, magazines & other media on issues such as free trade, finance, entrepreneurship & women business owners. Ms. Swift is a past President of the Empire Club of Canada, a former Director of the CD Howe Institute, the Canadian Youth Business Foundation, SOS Children’s Villages, past President of the International Small Business Congress and current Director of the Fraser Institute. She was cited in 2003 & 2012 as one of the most powerful women in Canada by the Women’s Executive Network & is a recipient of the Queen’s Silver & Gold Jubilee medals.
