The outlook: B.C.’s economic action plan for 2025-2026

Towards the end of June 2025, a pressurized tanker ship, the GasLog Glasgow, docked at Kitimat on British Columbia’s north coast. It filled up with the first shipment of super-cooled liquefied natural gas from the newly completed LNG Canada terminal and set sail again for the port of Incheon, South Korea.

With this voyage, a potentially huge new market was made accessible to natural gas producers in northeastern B.C. and elsewhere in Canada, with half the sailing time to Asia as competing LNG exporters in the United States. A new industry producing LNG for export was launched in Canada, with the participation of local First Nations. Importing countries will be aided in their attempts to reduce greenhouse gas emissions as they substitute natural gas power for coal. And Canada’s economy will grow and diversify its exports to countries with which it runs significant trade deficits.

To be sure, the B.C. and Canadian economies face challenges. The second coming of the Trump administration in the U.S., with its penchant for tariffs, has been a shock to the entire global trading system. The economic climate appears to be nearing a cyclical low. But with the startup of LNG Canada and other developments, Canada’s westernmost province is responding to new imperatives, such as the need to broaden trade partnerships and lessen our dependence on the increasingly unreliable U.S. market.

Faced with rising external threats, both the B.C. and federal governments are in agreement on three key priorities:

• To diversify trade and investment relationships, focusing on the growing economies of Asia in particular. In May, for example, Premier David Eby accompanied a trade mission to Malaysia, South Korea and Japan.
• To accelerate the capital projects by easing regulatory barriers while still engaging in due consultation with First Nations and other stakeholders. The incoming federal administration of Prime Minister Mark Carney passed a bill to this effect with the support of the Official Opposition. The province is working on similar legislation; in February, it identified 18 resource and infrastructure projects with a collective price tag of $20 billion that it aims to put on the fast track.
• To eliminate interprovincial trade barriers that hamper trade and labour mobility within Canada. The federal government passed legislation in June that removed 53 exemptions to the Canada Free Trade Agreement. Minister of Internal Trade Chrystia Freeland now plans to convene a committee on internal trade with representatives of all provinces and territories with the aim of eliminating provincial restrictions as well. B.C. has been an early and vocal supporter of free movement of goods and labour within Canada, citing its bilateral agreement with neighbouring Alberta.

Economic signals to watch

The combination of tariff uncertainty and high household debt levels will keep B.C. GDP growth this year near a cyclical low of 1.2 percent seen in 2024, Deloitte LLP predicted in a mid-year economic outlook. But there are positive new developments now and on the horizon. Each tanker that sets sail from LNG Canada, for example, represents an estimated US$150 million in new revenue for B.C., and there are three more LNG projects under construction on the north and south coasts. The increased demand for natural gas is expected to boost exploration and production in the northeast of the province.

Soaring demand for minerals critical to the energy transition as well as precious metals have seen 27 mine and mine extension projects reach the late stages of permitting, according to the Mining Association of B.C. (The province boasts 18 operating mines at present.) That potential expansion in the sector could see up to $90 billion in additional near-term economic activity. Though overall mineral exploration spending was down slightly in 2024, to $552 million, the search for critical minerals more than doubled, to $49 million.

While the forest industry’s future is clouded by a combination of tariffs, declining wood supply due to past beetle infestations and low commodity prices, the demand for green power is forecast to jump 15 percent by 2030—hence BC Hydro’s call for new power projects.

Part of that new demand is coming from data centres for artificial intelligence (AI). Bell Canada announced in May it would build six data centres in B.C. Meanwhile, homegrown telecommunications company Telus Corp. announced plans to invest $15 billion in B.C. over the next 15 years on data centres, network upgrades and other capital projects.

A windfall for tourism

Tourism operators are looking forward to an unprecedented influx in 2026 as Vancouver’s B.C. Place plays host to seven FIFA World Cup matches. The soccer tournament is expected to generate $1.7 billion in economic benefits to B.C. and attract an additional one million out-of-province visitors between 2026 and 2031. As it is, this year Vancouver International Airport is projecting its busiest summer ever, with 6.7 million passengers expected to transit the air hub between June 15 and Labour Day based on advance bookings. This follows a long recovery from COVID-19.

With tourism occupancy at or near capacity during the peak summer season and in key destinations, marketing body Destination B.C. is shifting its emphasis toward shoulder seasons and attractions off the beaten path.

The technology sector continues to show strength overall as B.C. companies attracted $2.4 billion in venture capital funding in 2024—almost as much as perennial Canadian leader Ontario. Global corporations in all sectors have shown heightened interest in the province lately, with employment in multinational enterprises growing 46.3 percent between 2016 and 2022, far outpacing the rate of growth across Canada.

While the challenges facing B.C. in 2025 are real, so are the reasons for optimism for the years to come.