With the clock ticking for Canada to finalize a trade agreement with the United States, numerous Canadian enterprises are anxious, foreseeing a potential loss of up to half of their revenue if the new tariffs are implemented. The impending U.S. tariffs, scheduled to come into effect this Wednesday unless a last-minute deal is struck, would impact $28 billion worth of Canadian goods, including electronics, dairy, alcohol, and wood, among others.
Negotiations are reaching a critical stage, with Canadian officials likely to meet U.S. Trade Representative Jamieson Greer before Prime Minister Mark Carney and U.S. President Donald Trump engage in discussions ahead of the tariff deadline. The final decision on any deal rests with President Trump, as reiterated by America’s chief trade negotiator.
For some Canadian businesses, the proposed tariffs not only mean increased prices for American customers but also pose challenges in cross-border shipping. Todd Stafford, president of Northern Cables in Brockville, Ontario, which heavily relies on U.S. buyers for half of its sales, expressed concerns about potential business loss if the tariffs are levied.
Stafford emphasized that the company, employing 320 individuals in Brockville, has managed to avoid layoffs for over two decades. However, he fears that the tariffs could exacerbate existing challenges such as a slowdown in condo construction and competition from lower-priced Chinese products.
While most cross-border trade between Canada and the U.S. has been shielded under the Canada-U.S.-Mexico Agreement (CUSMA), the new tariffs could affect about five percent of overall trade, impacting items like hockey sticks, flowers, and antiques. Sectors such as energy, potash, and critical minerals are expected to remain unaffected.
Jasmin Guénette, VP of national affairs at the Canadian Federation of Independent Business (CFIB), highlighted the apprehension among business owners facing the potential revenue loss. Cindy Baldassi, owner of CindyLouWho2, a Calgary-based jewelry company, expressed worries about losing half of her business due to the tariffs, prompting her to halt U.S. shipping and adjust prices.
As businesses prepare for the impact of the new tariffs, some have already felt the repercussions. Randy Williams of Monterey Textiles mentioned that the threat of tariffs has led to layoffs and decreased orders, affecting businesses on both sides of the border. Similarly, beekeeper Lorne Prins from Alberta is bracing for the impact on the honey industry if the tariffs disrupt honey exports to the U.S., potentially creating a surplus in Canada.
With uncertainties looming, Canadian businesses are exploring alternative markets and strategies to navigate the evolving trade landscape.