Canada’s New Immigration Direction: Strategic Implications for Foreign Entrepreneurs.

In May 2025, Prime Minister Mark Carney announced a new mandate to Canada’s immigration leadership, which focuses on two primary immigration objectives:  

• bringing immigration levels back to manageable rates; and  

• drawing top global talent to strengthen Canada’s economic foundation. 

The new immigration mandate represents a fundamental shift in Canada’s approach to managing population growth and economic development. For foreign entrepreneurs considering Canada as their business destination, these policy changes introduce both significant challenges and strategic opportunities. This article breaks down the key policy shifts and explains how business-minded newcomers can adapt to and succeed in the evolving Canadian immigration landscape. 

A New Direction in Canadian Immigration Policy (2025-2027) 

Canada’s immigration strategy is no longer just about numbers—it’s about sustainability and economic alignment. In his mandate letter to the Minister of Immigration, PM Carney emphasized a more measured pace of immigration while prioritizing talent that fuels Canada’s economic engine.  

While Mark Carney’s official mandate letter emphasizes economic alignment and public confidence in the immigration system, a broader policy direction is emerging. Several key proposals—some signalled during the recent federal election campaign and others previously introduced by Minister Marc Miller—suggest how Canada’s approach to immigration may evolve under the new leadership. 

Proposed or Signaled Changes Include: 

• Reducing Permanent Resident Admissions: The government may gradually decrease its permanent resident intake to more sustainable levels, with past targets indicating a possible drop to 365,000 by 2027. This proposal was highlighted in the 2025–2027 Immigration Levels Plan, published under Minister Miller, and reiterated as part of Carney’s campaign messaging to manage growth responsibly. 

• Capping Temporary Residents: A proposal to limit temporary residents—including students and foreign workers—to no more than 5% (currently 7.5%) of the Canadian population by 2027 was widely discussed during the 2025 election cycle. While not explicitly stated in the mandate letter, it is expected to shape policy implementation moving forward. 

• Shifting Focus to Economic Contributions: Both the campaign platform and the recent mandate letter emphasize attracting immigrants who directly support Canada’s economic and labor market needs—particularly in sectors like housing, construction, and infrastructure. 

• Strengthening the Global Talent Strategy: The Global Talent Strategy is expected to be updated to prioritize high-demand professionals, including those from the U.S. and partner countries. Though not new, this remains a cornerstone of Canada’s approach to addressing skills shortages while limiting overall numbers. 

The federal government’s decision to implement more restrictive immigration targets reflects a response to infrastructure pressures and housing shortages that have emerged from rapid population growth. The planned reduction of permanent resident admissions from 395,000 in 2025 to 365,000 by 2027, coupled with a national cap limiting temporary residents to 5% (or approx. 2.8 mln. down from the current 3 mln.) of the Canadian population, signals a more selective approach to immigration policy. 

This shift represents the most significant recalibration of Canada’s immigration strategy in decades, moving away from the expansionist policies that characterized the post-pandemic recovery period toward a more measured approach that prioritizes integration capacity and economic alignment. 

Direct Impact on Entrepreneurial Immigration Pathways 

Start-up Visa Program Implications 

The Start-up Visa Program, Canada’s flagship entrepreneurial immigration pathway, will likely face increased competition under the reduced PR admissions cap. With fewer overall spots available, the program may become more selective, potentially raising the bar for business concept viability, team composition, and market potential assessments. 

One possible scenario under the new mandate is a restructuring of the Designated Organization (DO) network. Currently, there are 86 designated organizations authorized to nominate entrepreneurs, with each organization permitted to support up to 10 candidates annually. However, these organizations operate under different priority classifications, with some receiving preferential status over others. Given the government’s focus on economic impact and sectoral priorities, a potential policy response could involve canceling or suspending non-priority designated organizations, effectively reducing the total number of available nomination slots while concentrating resources on DOs that demonstrate stronger alignment with critical sectors. 

This restructuring remains speculative, but entrepreneurs should be aware that the DO landscape may become more concentrated and competitive. Those working with non-priority designated organizations may face particular uncertainty, while ventures aligned with priority DOs focused on housing, infrastructure, and clean technology may find more stable pathways. 

While entrepreneurs may benefit from shorter processing times as a result of the more restrictive intake policies, they should prepare for significantly more rigorous evaluation criteria and heightened competition for available spots. The emphasis on economic impact suggests that ventures addressing critical sectors—housing technology, construction innovation, infrastructure solutions, and clean technology—may receive preferential consideration. 

Provincial Nominee Programs – Entrepreneur Streams 

Canada’s new immigration direction for 2025 sets lower targets for both permanent and temporary residents—but how each province will respond is still uncertain. Some may see this as an opportunity to attract more entrepreneurs who can create jobs, invest in local economies, and support key sectors like housing, agriculture, and clean technology. In particular, rural and underserved regions could benefit from welcoming business owners who bring new energy and long-term value to their communities. 

Meanwhile, provinces like British Columbia and Ontario may take a more cautious approach. They could tighten eligibility rules, increase investment or job creation requirements, or focus only on specific sectors with the greatest economic need.  

For foreign entrepreneurs, this means it’s more important than ever to research provincial programs, stay flexible, and build strong, localized business proposals that align with a province’s current priorities. 

Entrepreneur (C11) Work Permits – Strategic Implications 

The impact of the 5% temporary resident cap on C11 work permits for entrepreneurs remains to be seen, as this pathway occupies a unique position within Canada’s immigration framework. While C11 is a temporary program, it is specifically designed to attract entrepreneurs and self-employed individuals who bring significant economic benefits to Canada. Given that economic contribution has become a central focus in Canada’s new immigration mandate, it remains unclear whether C11 will face more restrictive treatment or receive priority consideration. 

The mandate signals that Canada will actively seek to attract talent from the United States and other partner countries operating under free trade agreements while simultaneously developing trading relationships with new markets. C11 work permits align directly with these strategic objectives, creating uncertainty about their future treatment under the temporary resident cap. 

Two potential scenarios could emerge: 

• a more restrictive approach that aligns with the 5% cap and the recently reduced work permit duration from two years to 18 months, or  

• a more permissive approach designed to stimulate economic growth, attract investment, draw international talent, and create employment opportunities for Canadians.  

The government’s ultimate direction on this pathway remains to be determined. 

However, regardless of which approach prevails, certain factors will likely make a significant difference in application outcomes. Ventures operating in priority sectors—housing technology, infrastructure development, and clean technology—combined with exceptional business plans and demonstrated local community support, will be better positioned for approval.  

Investors & Entrepreneurs from Free Trade Agreement Countries  

The 2025 immigration mandate explicitly signals Canada’s intention to strengthen economic ties with Free Trade Agreement (FTA) partner countries, creating potentially advantageous pathways for investors and business professionals from these jurisdictions. The mandate’s emphasis on attracting talent from the United States and other partner countries suggests that investors and business people from the United States, Mexico, European Union, Columbia, Peru, CPTPP countries (Asia-Pacific), and other FTA partner nations may benefit from streamlined processing, expanded work permit categories, and potentially preferential consideration within existing immigration programs. 

While the FTA-based programs remain LMIA-exempt and relatively efficient, entrepreneurs would not be expected to clearly demonstrate that their presence in Canada offers tangible benefits. Intra-Company Transferees will likely need to show more robust Canadian operations and a real transfer of expertise. Investors may be expected to contribute to strategic sectors like infrastructure, clean technology, and housing. Self-employed professionals could face tighter interpretations of what qualifies as a “significant benefit” to Canada. 

Work Permit Renewals for Entrepreneurs: Navigating the New Reality 

Canada’s shift toward reducing temporary residents to 5% of the population by 2027 suggests that work permit renewals for entrepreneurs will likely become more challenging and subject to increased scrutiny. Immigration officers will probably place greater emphasis on measurable business progress, concrete economic impact, and clear justification for why the entrepreneur’s continued presence in Canada is essential. Entrepreneurs who obtained work permits based on proposed business plans will need to demonstrate substantial results—such as jobs created for Canadians, revenue generated and community partnerships. 

Those who can show substantial progress from their original business plans and demonstrate that their continued presence is necessary for ongoing economic benefits to Canada will be better positioned to secure successful renewals in this more demanding environment. 

Conclusion 

Canada’s new immigration mandate signals a strategic evolution—one that prioritizes sustainable population growth and targeted economic contributions. For foreign entrepreneurs, this recalibration brings both challenges and clarity. The reduced immigration targets and sector-specific priorities mean the path forward is narrower—but also more focused for those who align with Canada’s goals.

Navigating this new reality successfully requires more than a good business idea. It demands informed planning, sector alignment, and a well-executed immigration strategy backed by professional insight.

Start with LIA, our Legal AI Assistant, for instant answers and guidance—available 24/7.

Then connect with our experienced immigration lawyers for a customized approach tailored to your goals, your background, and Canada’s evolving policies.

About the Author

Feruza Djamalova is a Canadian immigration lawyer specializing in business immigration pathways including the Start-up Visa Program, Provincial Nominee Programs, and investor immigration streams.  

A graduate of the University of Toronto, Faculty of Law and  Stanford University’s LEAD Business Program, she brings both legal expertise and business acumen to her practice.  

Her insights on Canadian immigration policy and entrepreneurial immigration have been frequently published and cited in Forbes, and in Spring 2025, she was honored with a Thought Leader Award by Mondaq, recognizing her significant contributions to immigration law discourse and policy analysis. Feruza regularly provides commentary on immigration policy developments and their impact on Canada’s entrepreneurial ecosystem, offering practical guidance to foreign investors and business leaders considering Canada as their next business destination through her strategic approach that combines deep knowledge of immigration law with understanding of business development needs.