Voice of Business: Everything Tariffs: Local Panel Insights, Federal Support and Economic Impact
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This week on Voice of Business, we are discussing the impact of tariffs and what has happened since their implementation.
Tariffs came into effect on March 4, and we recently hosted a well-rounded panel with industry experts to examine their effects. This week, we will explore how the Canadian government has responded and what it means for businesses.
March has been a volatile and concerning month for our members and local businesses. As of March 4, at 12:01 a.m., U.S. tariffs took effect due to Canada’s perceived inaction on Fentanyl-related concerns. In response, the Canadian government responded with counter-tariffs on $30 billion worth of goods. If U.S. tariffs remain in place, total Canadian countermeasures could increase to $125 billion, totalling $155 million in tariffs on U.S. imports. The affected products such as electric vehicles, fruits, vegetables, beef, pork, dairy, electronics, steel, aluminum, trucks, and buses. Currently, the list of affected goods includes orange juice, peanut butter, wine, spirits, beer, coffee, appliances, apparel, footwear, motorcycles, cosmetics, and certain pulp and paper products. On March 6th, the U.S. announced that CUSMA-related products, including auto parts, would be exempt from tariffs until April 2nd. Canadian officials later confirmed that approximately 40per cent of Canadian exports to the U.S. would be exempt and that Canada would not proceed with the second wave of $125 billion in tariffs until April 2nd. Despite Canada appointing a Fentanyl Czar and increasing border security measures, these efforts have not been sufficient to prevent U.S. tariffs. With $3.6 billion in goods and services crossing the border daily, these tariffs will have a substantial impact on jobs, industries, and local businesses. The effects are already being felt. Businesses exporting products to the U.S. are experiencing financial strain, with some anticipating layoffs and price increases to offset rising costs. Supply chain disruptions are also expected, as importers of affected goods will face higher prices. Consumers will bear the burden through increased costs at checkout. The Canadian Chamber of Commerce (CCC) has been actively advocating for the removal of U.S. tariffs, estimating that their economic impact on every Canadian will be approximately $1,900. Canada remains the number one trading partner for 34 U.S. states, highlighting the deeply integrated nature of the supply chain. In Ontario alone, nearly one million Canadian jobs depend on Ontario’s U.S. exports, and 19,927 companies export to the U.S. These tariffs will create logistical and financial challenges, particularly for industries such as homebuilding, which rely on American products and will be forced to pass price increases onto consumers. Given the deeply integrated trade relationship between Canada and the U.S., supporting millions of jobs in both countries, it is clear that continued tariffs would cause significant economic damage.
Despite the challenges, there is some hope. Last week, Community Futures and the local Chamber of Commerce hosted a Tariff Panel discussion featuring industry experts.
Some Key takeaways from the panel included:
the importance of businesses connecting with provincial and regional Chambers of Commerce to explore new markets.
Panelists emphasized the urgent need for interprovincial trade reform to increase cross-border trade within Canada. Businesses were encouraged to participate in global trade missions with the government to diversify export markets.
Expanding port infrastructure was identified as a crucial step to improving trade efficiency.
Additionally, the panel highlighted that the U.S. may underestimate Canada’s leverage, particularly in sectors like agriculture, where Canada produces 90 per cent of the world’s potash, a critical resource for American farmers.
Although the trade war is beyond our control, recognizing these opportunities provides a sense of optimism. Canada is more unified than ever in its approach to economic resilience. Municipal governments are taking action, with both Peterborough County and the City of Peterborough committing to a “Made in Canada” procurement strategy to ensure local spending benefits local businesses. The Canadian government has also introduced several measures to support businesses affected by tariffs:
The Trade Impact Program, launched through Export Development Canada, will deploy $5 billion over two years to help exporters reach new markets, navigate economic challenges, and address issues such as currency fluctuations and cash flow shortages.
Additionally, $500 million in favourable loans will be available through the Business Development Bank of Canada to support impacted businesses and their supply chains, along with advisory services on financial management and market diversification.
Providing $1 billion in new financing through Farm Credit Canada to assist the agriculture and food industry with cash flow challenges, helping businesses adapt to changing market conditions. If your business is struggling with these challenges, please visit our Tariff Resources page for contact points and assistance. The situation is evolving rapidly, and while the future
