“A little more time now can bring lasting advantages to an integrated North American economy, and the wait is worth it,” said Candace Laing, president and head of the management of the Canada Chamber of Commerce.
Canada has had tense relations with its closest ally since the start of the year, when Donald Trump started his second presidency with a pricing regime targeting its neighbor in the North and a large group of other countries.
Steel, aluminum and Canadian automobile were the main victims of its first customs rights, but the American president finally agreed to explore a possible agreement.
He set the deadline for August 1 to conclude a trade agreement and indicated that, if no agreement was negotiated by then, customs duties on goods that are not in accordance with the Canada-States-Mexico (ACEUM) agreement would increase immediately.
This exemption means that a large part of Canada’s cross -border trade is currently exempt from customs duties, according to Candace Laing.
“However, not all Canadian companies benefit from this advantage, and the increase in customs duties at 35 % on products that do not comply with ACEUM imposes an additional burden on them,” she added.
She believes that Canadian and American companies quickly need more certainty.
The Canadian Federation of the Independent Company (FCEI) shares this opinion. It warns that current uncertainty prevents many of its 100,000 members from planning the future.
The absence of resolution left companies in uncertainty about the need to reduce their activities or to dismiss staff.
“The FCEI supports the idea that it is better not to conclude an agreement rather than to conclude an unfavorable agreement, but the absence of an agreement means that companies will not be able to adequately plan the future,” said Jasmin Guénette, vice-president of national affairs at the FCEI.
Already impacts
Some large companies have felt the effects for even longer, because their sectors of activity have been affected by the customs duties imposed by the tenant of the White House.
For example, customs duties have increased the price of Canadian cars by 25 % to the Americans, which reduced the volume of vehicles crossing the border, said Flavio Volpe, president of the Automobile Parts Manufacturers.
So far, car manufacturers absorb the cost of customs duties, but that cannot last forever, because many of them have seen their income, he added.
He suspects that car manufacturers will make more and more strategic decisions about where they produce their vehicles for each market.
“If you make the same car in Oshawa (in Ontario) as in Fort Wayne, in Indiana, and you want to sell it to a buyer in Texas, will you make more in Oshawa for the Texan buyer who will have to pay $ 75,000, or are you going to make more in Indiana so that this buyer pays only $ 60,000? He illustrated.
Unifor’s president Lana Payne said that the impact of customs duties on workers and businesses must not be underestimated, recalling the layoffs and quarter-work reductions since the start of the trade war under Donald Trump.
“This is an extortion game to which the President of the United States is engaged,” said Lana Payne, whose union represents more than 315,000 workers.
“We cannot allow the tactics he uses with us lead to neglect the automotive industry, forestry workers and steel workers,” she said.
Lana Payne believes that Canada has levers, such as aluminum, critical minerals, electricity, oil or potash, and should use them to retaliate. She said she repeated this message to the Canada Ambassador to the United States and the Prime Minister’s office.
“We have to fight for all workers, because we know that it will not stop at them,” she said. It is important, now, to set limits and understand that Canada has great strength and a large lever, and that we will have to use part. »»
(With information from Daniel Johnson in Toronto and Alessia Passafium in Ottawa)