Canadian businesses and industry leaders are preparing for the impact of new 50% U.S. tariffs, hoping for swift domestic assistance. Prime Minister Mark Carney summoned his negotiation team back to Ottawa as trade discussions collapsed due to what he deemed as unreasonable demands from the U.S.
With negotiators now sidelined, U.S. President Donald Trump’s threatened 50% tariffs are now in effect, covering various Canadian exports including wood furniture, cement, plywood, and wine. Ron Kubek, the owner of Lightning Rock Winery in B.C., managed to send a $20,000 order to Washington state before the tariffs took effect, marking his last shipment due to the increased costs.
Kathleen Chapman, the president of aVenco, faces significant challenges with her Bowmanville-based parchment baking paper business, as a substantial portion of her products are sent to the U.S. The ongoing trade dispute has led to uncertainty among American clients, hindering her business’s future planning efforts.
While the broad economic impact of the new tariffs may seem relatively minor, certain sectors, especially manufacturers in Quebec and Ontario producing plastic, chemicals, cement, and concrete, are expected to bear the brunt of the tariffs. Dennis Darby, president of Canadian Manufacturers and Exporters (CME), expressed concerns over the detrimental effects on manufacturers, who are already grappling with existing sectoral tariffs.
University of Calgary economist Trevor Tombe estimates potential job losses of around 87,000 nationwide due to the new duties, affecting industries such as agriculture, textile, electronics, furniture, and plastics manufacturing. The indirect impact on sectors like warehousing and trucking could also be substantial.
Small business owners like Ron Kubek fear the repercussions of Canada’s retaliatory tariffs, which could exacerbate their challenges. Kubek hopes for government support to alleviate the impact on his winery, especially concerning potential input cost increases due to tariffs on U.S. imports.
As businesses brace for the impact of the new tariffs, the Canadian Federation of Independent Business (CFIB) president, Dan Kelly, emphasizes the need for effective support programs tailored to small and medium-sized enterprises. With past relief efforts falling short for many small businesses, Kelly stresses the urgency of providing substantial aid promptly to mitigate the short-term effects of the tariffs.