Critical Iran Updates – May 23

How the Iran War Affects Canadian Businesses & New Government Assistance  

Toronto, ON – May 23, 2026

Recent headlines underscore the significant impact of the war in Iran on Canadian businesses, the national economy, and our international relationships. Below is a concise overview of the key developments and how GTA Strategies is positioned to support your organization during this period of uncertainty.

Major Headlines & Business Impacts

Economic Disruption

• The Iran war has led to the closure of the Strait of Hormuz, causing global energy prices to surge. Canadian companies, especially in aviation and energy, are experiencing higher costs and operational challenges. For example, CAE Inc. is scaling back international operations and consolidating training centers due to reduced demand and soaring jet fuel prices.
• Inflation has risen to 2.8% in April, primarily driven by a 28.6% year-over-year increase in gasoline prices. This is affecting transportation, food, and rent costs, with further knock-on effects expected if the conflict persists.

Government Relief & Funding

• The federal government has introduced a five- month relief on gasoline excise duty, reducing costs by 10 cents per litre until Labour Day. This measure aims to cushion businesses and consumers from immediate fuel price spikes.
• While there is no broad- based emergency funding package announced yet, the government is actively reviewing support mechanisms and has signaled readiness to invest in defence and infrastructure, which may create new opportunities for suppliers and contractors.

National Interests & International Relations

• Canada is increasing its defense spending, targeting 3.5% of GDP by 2035, and is investing in military modernization. However, relations with the U.S. have become strained, with the U.S. pausing participation in a key joint defense board and imposing new tariffs. This could affect cross-border trade and procurement decisions.
• Canada is also seeking to diversify its defense and trade partnerships beyond the U.S., which may open new markets and collaboration opportunities for Canadian businesses.

Inflation & Market Volatility

• The inflationary impact is currently most visible at the gas pump, but economists warn that higher energy and fertilizer prices could soon drive up food and other input costs.
• The Bank of Canada is holding interest rates steady for now, but ongoing volatility is expected.
• Despite these challenges, Canadian and U.S. stock markets have shown resilience, with optimism tied to potential ceasefire developments.

How GTA Strategies Can Assist

Grant & Funding Alerts: GTA Strategies is closely monitoring all government relief measures, grants, and funding opportunities as they are announced. We will keep you informed and assist with applications to maximize your access to available support.

Please reach out to GTA Strategies for personalized support or to subscribe to our grant and war update bulletins. We are committed to helping your business stay resilient and informed during these challenging times.