(Montreal) Despite the decree of the American president, Donald Trump, Canada is one of the countries least struck by its protectionist aims. Uncertainty still hurts companies, warns the Quebec business community.
Customs duties imposed by the United States on Canadian products were increased to 35 % on Friday, but products in accordance with the free trade agreement between Canada, the United States and Mexico (ACEUM) are exempt.
“The consequences of current announcements are manageable for the Canadian economy,” analyzed economist Sébastien McMahon, of a financial group, in an interview. For the moment, we get relatively well. »»
Mr. McMahon pointed out, in an interview, that almost 90 % of Canadian exports are exempt from customs duties because they comply with ACEUM.
Even if the Carney government has not reached a commercial agreement before the deadline of 1is August, Canada has a competitive advantage compared to other business partners, even those who have signed an agreement.
Today, taking into account the exemptions from the ACEUM, we find ourselves the second country with the lowest rate towards the United States. So Mexico is first. After that, it’s us with an average price of around 5 %.
Sébastien McMahon, economist of the financial group
Certain industries are however affected harumously, notably aluminum, copper, timber and the automotive sector, which are struck by other customs duties.
An uncertainty that hurts
Companies suffer from economic uncertainty, however, has nuanced the president and general manager of the Quebec Chambers of Commerce Federation (FCCQ), Véronique Proulx, in an interview. “It is uncertainty that hurts our businesses and regions the most,” she said.
The voice of the Quebec business community is concerned about the drop in business investments, while the economy is “on a break”. “It will have an impact on the medium and long term compared to our capacity, in fact, to keep our businesses, especially industrial, in the different regions of Quebec”, warned Mme Proulx.
Photo François Roy, Archives La Presse
The CEO of the Quebec Chambers of Commerce Federation, Véronique Proulx
In the Quebec manufacturing sector, investments fell by 318 million compared to last year, according to an assessment drawn by the FCCQ from statistical Canada data.
The effect on Quebec’s economy was also felt on jobs. He got lost 15,000 jobs in the manufacturing sector in the first six months of the year, according to the FCCQ’s assessment. This figure is 25,000 jobs for the construction sector and 4,000 jobs in the primary sector.
“Our companies have reduced production and let workers go, unfortunately,” said Mr.me Proulx.
Uncertainty will not dissipate completely, but things could improve, believes Mr. McMahon. “It will remain a feeling of uncertainty, but perhaps uncertainty could reduce because we realize that it may not be a disaster scenario that we are living. »»
The priority will be to preserve free trade between the United States and Canada to limit damage, added the economist. “The important thing is that the free trade agreement holds the road in the long term. Now when we look at around 2026, it brings us to a new risk. Will Donald Trump oppose the renewal of this agreement? Will he want to renegotiate him? »»
This negotiation is critical for the economy, abounded atme Proulx, but, before an unpredictable president, the Carney government must also act on what it can control, she pleaded.
She gave as an example the local purchasing policies of governments. She also returned against restrictions on the number of temporary foreign workers.
“It is now that they must act to help companies that will be forced to reduce their production because the federal government does not renew the work permits,” she added.