Derek Friesen, the owner of PhiBer Manufacturing Inc. in Manitoba, has seen the impact of the Canada-U.S. trade conflict on his agricultural equipment business. While his company mostly avoided the trade war’s effects, the recent announcement of retaliatory Canadian tariffs on $27.6 billion worth of U.S. goods will now hit his business directly.
PhiBer Manufacturing imports frames from Iowa for their agriculture equipment, specifically dash trailers used by large-scale farmers. These frames will face new retaliatory tariffs starting on Sept. 8. Friesen expressed concern that imposing tariffs on such crucial components will significantly raise costs, potentially rendering the trailers economically unviable.
With dash trailers constituting a significant portion of his sales, Friesen fears that the increased prices may make them unaffordable in the near future. While some businesses hope that these countermeasures could boost domestic sales, others, like Friesen, are worried about the negative impact on their operations.
The retaliatory tariffs, ranging from 15 to 50 percent, will affect various U.S. products, including seafood, paper goods, furniture, apparel, tools, and motorcycles. According to economist Bradley Saunders, the Canadian government targeted goods with domestic substitutes to minimize the impact on consumers and industries while hurting American businesses.
For companies like Danby Appliances in Ontario, the tariffs could have mixed effects. While some parts will become more expensive, making certain products less competitive, increased tariffs on items like refrigerators could benefit Canadian-made goods. However, overall, these tariffs are expected to pose challenges for businesses, potentially leading to reduced consumer spending.
Simon Gaudreault from the Canadian Federation of Independent Business (CFIB) highlighted the negative implications of retaliatory tariffs on Canadian businesses, especially those reliant on U.S. imports. Despite government support measures, including a $7.5-billion aid package, concerns remain about the sustainability of businesses amid ongoing trade tensions.
Gaudreault emphasized the importance of resolving the trade war to alleviate the pressures faced by Canadian businesses. While the government’s support initiatives aim to assist affected sectors, there are uncertainties about their effectiveness, particularly in aiding small businesses impacted by the tariffs.