Abbotsford and Mission brace for impact of potential U.S. tariffs
2 cities ranked 15th most vulnerable in Canada in a recent report for their exposure to tariff risks
For Abbotsford business owner Esther De Wolde, uncertainty over potential U.S. tariffs is already affecting operations.
"Approximately 87 per cent of our products are shipped across the border into the U.S.," said De Wolde, CEO of Phantom Screens, which makes retractable screens for buildings.
The company has been in business for 33 years, but in anticipation of declining demand from U.S. customers, De Wolde has reduced her production schedule from five days per week to four.
"I think it's a really good time for ... entrepreneurs to consider our dependency on certain markets and to realize that nothing is for sure, nothing is certain, and so diversification is extremely important," she said.
De Wolde's concerns are shared by other business owners in Abbotsford and Mission, two cities that could be among the hardest hit in B.C. if U.S. President Donald Trump follows through on his tariff threats, according to a recent report from the Canadian Chamber of Commerce.
The chamber's report ranks 41 census metropolitan areas from most to least vulnerable to trade tariffs, and the two B.C. cities — which make up the Abbotsford-Mission metropolitan area — rank 15th, with their exports to the U.S. totalling nearly $1.5 billion annually, or $7,000 per capita.
Canada is nearing the end of its 30-day reprieve from Trump's promise of 25 per cent tariffs on nearly all Canadian products entering the U.S., and 10 per cent on Canadian oil.
De Wolde says she fears that if the tariffs take effect, the impact on her business and her 180 employees could be devastating.
Resilient local economies
The chamber's report assessed Statistics Canada data from cities with populations over 100,000 to determine their reliance on U.S. exports.
Overall, B.C. cities are among the least vulnerable to U.S. tariffs.
Kamloops, for instance, ranked 40th out of 41 Canadian cities, where 41 is considered the most resilient. Nanaimo, Victoria, Kelowna, Vancouver, and Chilliwack also ranked on the stronger end of the scale.
Pascal Chan, the chamber's vice-president of strategic policy and supply chains, attributes this to the province's geographic advantage. Being on the West Coast with easy access to trade in the Indo-Pacific reduces the province's reliance on the U.S., he said.
New markets
Mission Mayor Paul Horn says Abbotsford and Mission's vulnerability ranking isn't surprising given their proximity to the U.S. border.
"Our industry, our logistics sectors are often closely intertwined," he said.
Horn added that, in the face of tariffs, he thinks it's important for residents to spend their money locally.
Abbotsford Mayor Ross Siemens echoed that sentiment, saying tariffs may push local businesses to seek new markets.
"Our geographic location provides us greater access and ability to leverage other existing international trade agreements, and many of our residents have language skills and business experience in other global markets," he said in a statement.
Still, diversifying away from the U.S. could have its challenges.
Abbotsford is home to about 330 exporters, and the U.S. is the primary trading partner for 90 per cent of them, said Alex Mitchell, CEO of the Abbotsford Chamber of Commerce.
Goods exports make up 12.5 per cent of the city's GDP.
"We're already hearing from our members of significant strategic decisions from diversifying their customer relationships outside of the United States, increasing prices, and exploring domestic sourcing alternatives wherever possible," she said.
Mitchell is calling on the federal government to remove interprovincial trade barriers to help buffer against a potential trade war.
On Friday, Ottawa announced it will eliminate 20 of the 39 remaining federal Canada Free Trade Agreement exceptions related to government procurement. The move aims to encourage more trade and opportunities for Canadian businesses within the country.
B.C. Economic Development Minister Diana Gibson has said the province is also working to remove its own red tape blocking trade.
With files from Sohrab Sandhu and Courtney Dickson