Canada’s business community is worried that Finance Minister Chrystia Freeland’s abrupt resignation from cabinet Monday morning will further erode investment in the country and destabilize an already shaky economy. 

In a letter addressed to Prime Minister Justin Trudeau and posted to X, Freeland said she and Trudeau have been “at odds about the best path forward for Canada.” 

“The sudden resignation of Canada’s finance minister exposes deeper cracks in the government’s ability to provide the stable, consistent leadership that businesses need,” said Council of Canadian Innovators president Benjamin Bergen.

“Canadian innovators can’t scale globally on shaky ground,” Bergen added. “We need strong leadership, not uncertainty, at this critical moment.” 

Stephen Tapp, chief economist at the Canadian Chamber of Commerce, echoed those concerns, saying the resignation “adds even more uncertainty to what’s already a highly uncertain economic outlook.” 

Freeland’s resignation came hours before she was due to deliver the government’s fall economic statement, a budget update that gives members of Parliament and the public a look at the federal books.

Former Chamber of Commerce president Perrin Beatty said the timing “couldn’t be worse,” noting that Freeland was Canada’s point person in trade negotiations with the U.S. during the last Trump administration and that Trudeau had tapped her to chair the revived cabinet committee on Canada-U.S. relations. “The chaos in Ottawa will encourage Donald Trump to step up pressure,” Beatty wrote on X. 

In her resignation letter, Freeland did not elaborate on what she and Trudeau have disagreed on. She did, however, write that the government should keep its fiscal powder dry in the face of a potential tariff war with the U.S. by “eschewing costly political gimmicks, which we can ill afford and which make Canadians doubt that we recognize the gravity of the moment.” 

The government announced initiatives in recent weeks to temporarily ease financial strain: a sales tax holiday and proposed $250 cheques for Canadians who made up to $150,000 in earned income last year. 

Factions of the business community, including some small businesses and economists, have criticized the initiatives as political ploys meant to boost the Liberals’ waning popularity without fixing long-term affordability or economic challenges. 

“Confidence in the government’s economic management is already low,” said Bergen, “and today’s chaos only reinforces that view.” 

Tapp said U.S. president-elect Trump’s threats to Canada’s economy could stymie business competition and hurt companies’ ability to attract investment. That, he said, could push them to move stateside. “As such, the government needs to prioritize encouraging business investment to spur economic growth and support long-term living standards,” he said. 

John Ruffolo, founder and managing partner of Maverix Private Equity, said Freeland’s resignation indicates a government in turmoil. “It’s very clear that the current government is in a complete free fall,” said Ruffolo, who has advised the government on innovation policy in the past. “They need to call an election and allow the electorate to decide what the next government is.”