An Independent Alberta Would Face a Long and Winding Trade Road

From: Lawrence Herman 

To: Albertans pondering separation 

Date: August 19, 2026 

Re: An Independent Alberta Would Face a Long and Winding Trade Road

Let’s enter the world of fantasy for a moment and assume that somehow Alberta were to become a totally separate country – “Albertastan.” While far-fetched, it’s instructive to consider what this would mean, both geopolitically and in terms of Alberta’s standing under international law. 

In the geopolitical context, it would be a small, landlocked country of five million people in a North American continent of more than 600 million. Globally, it would be in the same class of small landlocked countries that includes Luxembourg, Tajikistan, Armenia, even Rwanda and Burundi. 

Admittedly,  Alberta has oil, giving it political heft. But these geographic and demographic factors do carry political implications, the major one being that Alberta, with a relatively small population, would be confronting the United States – not under Donald Trump, who would be long gone – but still a huge and economically powerful country of some 350 million. 

As a newly formed country, Alberta would be shorn of all treaty relationships it now enjoys as part of Canada. Under international law, newly formed countries don’t simply inherit pre-existing arrangements. They have to negotiate their way in. 

This brings us to the challenges Alberta would face in securing stable, beneficial access to the US market, something that, whatever other issues may be in play, would be the most critical factor for its future as an independent country. It’s in this respect that the people of Alberta need to wake up to reality. 

Under the Trump administration, Canada-US relations are abysmally bad, with negative prospects for a successful renegotiation of the Canada-United States-Mexico Agreement now under way. However, there is always the possibility that compromises may emerge to maintain the agreement in some form. Even if that doesn’t happen under Mr. Trump, once the MAGA team leaves office there may be renewal of a mutually beneficial framework for North American trade. Whatever emerges, any new trade deal will be among Canada, the United States and Mexico. Because there’s no provision in the CUSMA for new entrants, admitting Alberta would require unanimous agreement of all three countries. 

Alberta would have to negotiate entry on its own. While its oil and gas reserves offer important leverage, the point is that the terms and conditions of access to the US market would not be automatic. 

Another concern for an independent Alberta would be securing oil and gas pipeline transit through both Canada and the United States. While one can reasonably assume that governments would want transit to be unimpeded, this is a complex and highly political issue. There would have to be an agreement to permit Alberta to become a party to the 1977 Canada-United States Transit Pipelines Agreement, for example. 

But this means negotiations by Alberta – both with Canada and with the United States. Maybe it wouldn’t be a problem. But who can say? 

When it comes to trade with other countries and regions, an independent Alberta likewise would not automatically get the rights and benefits it enjoys under Canada’s existing free trade agreements, such as with the European Union (the Comprehensive Economic and Trade Agreement), the Asia-Pacific region (the Comprehensive and Progressive Agreement for Trans-Pacific Partnership) and the separate Canada-South Korea free trade agreement. It would have to negotiate its way into each, a long and complex process. 

On a more technical level, tariffs are emerging as probably the most important factor in global trade law generally. Would an independent Alberta enact its own tariff regime? Or would it simply adopt the Canadian system? Whatever route it might choose, no foreign country would automatically grant the same tariff concessions to Alberta exporters that the rest of Canada has. Alberta would face the prospect of lengthy negotiations with these other countries to achieve the market access its companies now have as part of Canada. 

And these uncertainties multiply in terms of future deals, as Canada is in negotiations with India and in latter stages of concluding a deal with the Association of Southeast Asian Nations (ASEAN). And then there are some higher-level arrangements to consider, such as the issues in securing Alberta’s accession to the World Trade Organization. 

The point to all of this is to show the risks and uncertainties at several levels and in different dimensions were Alberta to leave the Canadian confederation. No one denies that Alberta has leverage in its huge oil and gas reserves. This gives it some serious cards to play. But once out of Canada and playing those cards internationally will involve a long, convoluted and highly uncertain game. While all this is happening, who would buy Alberta bonds? 

Lawrence Herman is counsel at Herman & Associates, a member of the Expert Group on Canada-US Relations and a senior fellow at the C.D. Howe Institute. 

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A version of this Memo first appeared in The Globe and Mail.