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A Thunder Bay business owner says he was left frustrated by the latest escalation in the trade war between Canada and the United States.
Canada walked away from negotiations with the U.S. on Friday, citing late demands from the United States relating to culture, autos, and sovereignty.
As a result, the United States imposed 50 per cent tariffs on various Canadian goods, with Canada set to respond with retaliatory tariffs after Labour Day.
U.S. President Donald Trump then posted on social media that the country would increase tariffs on Canadian cars, trucks, auto parts and steel from Canada to 50 per cent on Jan. 1.
“The reaction was, I’d say frustration, of course, and that’s kind of been the theme for the last year and a half, and a little bit of confusion as well,” said James Foulds, owner of Border Giant in Thunder Bay. “I was holding out hope that [the tariffs] wouldn’t go through.”
“We had that three day extension and no progress there,” he said. “This week is figuring out for a lot of businesses what their next steps are going to be.”
Border Giant is a parcel service and customs broker that helps clients import and ship products between Canada and the United States. Foulds said currently, the company is focused on helping clients, specifically those that manufacture products in Thunder Bay and ship them across the border, to navigate the new tariffs.
“I’m going through the details of exactly what is covered, if there’s any work arounds,” he said. “For example sometimes the specific product that is affected by tariffs, if you use a different material or say eliminate some component, they may sidestep the tariffs and be able to be sold to the USA.”
The Canadian retaliatory tariffs are further complicating things, however, with Foulds saying “we’re in a bit of a limbo” until more details about those retaliatory tariffs are announced, and businesses get a sense of the further effects the trade war may have.
Foulds added that he’d like to see governments provide more support to smaller businesses shifting away from Americans as their primary customers.
“The shipping costs for small business to ship the package or something like that over to Europe or Asia, they’re extraordinary,” he said. “If there’s any way to help minimize that and … have those markets open to them, that would be something the government could do.”
Foulds said any impact the tariffs have on Border Giant will come via the small businesses in Thunder Bay.
“If they’re not doing well, if they’re not able to trade, sell their goods to the USA, then we can’t earn revenue,” he said. “Because we are a customs broker and we’ve been developing technology, there is a lot of space, I guess, to help help guide small businesses to transition to new markets and navigate these changes.”
Charla Robinson, the president of Thunder Bay’s chamber of commerce, said she supports Prime Minister Mark Carney’s decision to “walk away from a bad deal.”
“We can only sign a deal that protects Canada’s sovereignty, strategic interests and long-term economic strength,” she said. “It’s not what we were hoping for, but we can support why we have to be where we are today.”
In terms of impacts on chamber members in the city, Robinson said the tariffs that went into effect on Saturday are very specific.
‘Holding pattern’
“So far, from my understanding, there may be perhaps a handful of businesses that are exporting to the U.S. the products that are on that list,” she said. “It’s not a large number of businesses as far as we can tell that will be hit with this new tariff.”
“Certainly, those businesses that have been paying the tariff on steel, aluminum, forestry, etcetera, etcetera, were really hoping for a deal that would reduce the tariffs that they’ve been paying already,” Robinson said. “That hope has also been dashed and those tariffs are continuing as well.”
Robinson said businesses are in a “holding pattern” as they wait to find out more about the Canadian government’s retaliatory tariffs.
“Every day is going to be a little bit of this shoe drops and then that shoe drops,” she said. “So we’re all just waiting to see what the next step is.”
