Trump's tariffs didn't hit B.C. as hard as feared — but add to air of uncertainty
While auto tariffs will not affect B.C. as much as Ontario, businesses say trade war taking its toll
B.C. escaped the brunt of the tariff broadside announced by U.S. President Donald Trump on Wednesday, but businesses say the ongoing uncertainty of the U.S.-Canada trade war is taking its toll.
On Wednesday, Trump put into order a broad swath of tariffs from the White House Rose Garden that targeted dozens of countries, and included new 25 per cent tariffs on Canadian-made passenger vehicles.
The levies add to existing tariffs on Canadian steel and aluminum, as well as tariffs on Canadian goods that do not comply with the United States–Mexico–Canada Agreement (USMCA).
B.C. businesses and analysts say Wednesday's announcement could have been much worse for the province, but that the on-again, off-again tariffs and Canada's counter-tariffs are creating an air of uncertainty for local businesses, regardless.
"I actually came away from the Rose Garden press conference a little bit relieved, to be candid," said Jock Finlayson, the chief economist for the Independent Contractors and Business Association in B.C. "Because I was expecting worse from sort of a Canadian and B.C. perspective, but we didn't see that today."
All the same, Finlayson said, "we're still facing headwinds."
Abbotsford among most affected
Abbotsford is the B.C. metropolitan area that's set to be most affected by U.S. tariffs, according to a recent Canadian Chamber of Commerce report.
Alex Mitchell, the CEO of the Abbotsford Chamber of Commerce, said that's due to the community's high reliance on exporting products to the U.S.
"Abbotsford is home to over 300 exporters and many of those are manufacturers, agricultural businesses, who for 90 per cent of them, their primary customer is the United States," she said.
Mitchell said that, for a long time, it had been easy to rely on the U.S. as a qualified and solid trade partner.
"But of course, now we see the erosion of that relationship that's happened so quickly within a matter of time," she said. "And we're now at the place where many of these companies need to be looking elsewhere for opportunity."
BRC Aircraft, a plane manufacturer in Abbotsford, does 80 per cent of its business with the U.S. Its CEO, Zrinko Amerl, said the company is heavily reliant on U.S. parts, and if tariffs were to directly impact the B.C. aerospace industry, it would be devastating.
"It will decimate us, we will probably lose 50 per cent or 60 per cent of business right away," he said.
Marcus Janzen, the president of Abbotsford-based Calais Farms, said he aims to have his greenhouse-grown peppers over the U.S. border within 24 hours of them ripening — but he's facing a 25 to 30 per cent uptick in packaging prices, as he buys cardboard packaging from the U.S.
The farmer said he doesn't blame the manufacturers for lifting the prices, given how uncertain the supply and cost is amid the cross-border trade war.
"It's this, you know, on for three days, off, postponed, not sure what we'll do next," he said of the volatile tariff situation. "That's what's difficult to manage."
Amerl, like many B.C. business owners, said he's now trying to engage more with markets other than the U.S., such as South America.
The CEO said that, eventually, the global trade war initiated by Trump will benefit the Canadian aerospace industry, as other countries look to move production outside the U.S.
"There is a light at the end of the tunnel, and hopefully it's not a train coming at us," he said.
ABOUT THE AUTHOR
With files from On The Coast, Baneet Braich and Jessica Cheung