When U.S. President Donald Trump revealed the countries impacted by reciprocal tariffs, Canada was surprising left off the list.
“For the past few months, Trump’s administration has been using Canada as a sounding board for this policy to see how we would react for certain key industries, and now, he’s just blanketed it across the whole world,” said Robert Huish, an international development studies associate professor with Dalhousie University.
“It’s almost mind-numbing to try to keep up with it.”
While Canada was exempt from Wednesday’s sweeping tariffs, there’s no sigh of relief.
“I think Canadians are waiting for the next round of tariffs because they’ve already been clobbered twice,” said Huish.
Twenty-five per cent tariffs on some Canadian goods remain in place, as do Canada’s counter measures.
“People thought this was a negotiation tactic, that it was hopefully more bark than bite, but this will bite,” said Sydney Credit Union CEO Caleb Gibbons.
“A term you’ll hear a lot will be ‘stagflation.’ So, this will really increase the recession odds for the U.S.”
Gibbons said Canada’s likelihood of a recession has also increased.
Another new hurdle in the trade war has been the addition of Trump’s automotive tariff.
“The immediate effect of this is going to transcend down to job losses, certainly in Southern Ontario, but across other sectors as well,” said Huish.
“In Atlantic Canada, there’s very, very little wiggle room for a lot of products we export to the States already for profit margin. Twenty-five, 10 per cent tariffs, whatever it is, it gets into the equation and it’s going to make things a lot more difficult for people here, too.”
On Thursday, Canada announced counter measures in response to the auto tariff.
“I think we will be more resilient in the end, but none of these things happen overnight,” said Gibbons.
“Some of the things Trump is driving for in terms of onshoring, bringing manufacturing back to the country in the auto space, you’d be lucky to move the needle inside of three years, and in some sectors, it’s going to be much, much longer.”
Gibbons said people should plan for the tariffs to be in place for two years as a starting point.
“Administratively, this is a very complex legislation they’ve proposed here. So just the implementation of it alone and the uncertainty, I think, will drag on markets, especially once we get into the into the summer months,” said Gibbons.
