'It's going to be really bad,' Trump's proposed tariff strikes fear in business community

As federal and provincial politicians gather to determine next steps amid trade threats from president-elect Donald Trump, businesses in Cambridge are also preparing for the worst. 

President and CEO of the Cambridge Chamber of Commerce, Greg Durocher said that while unlikely the United States would actually implement a threatened 25 per cent tariff on Canadian goods, it is possible and would likely decimate local businesses. 

"Well, it's going to be really, really bad, but that is if it's a 25 per cent tariff and my assumption would be that Canada would reciprocate with a 25 per cent tariff on products coming in from the United States as well," said Durocher. 

This retaliatory behaviour between two of the largest trading partners in the world would not only hurt the economies, but the residents that live on both sides of the border, he added.

According to StatsCan, Canada and the United States trade over $2 billion a day over the largest land border in the world. Here in Cambridge, manufacturers like Toyota, BWXT and countless others either import or export goods to the United States.

A tariff is essentially a tax on any good that crosses the border. This would cost American companies more to import products from Canada.

Durocher noted that at least 65 per cent of all businesses in Waterloo region either import or export products from the United States and any trade war would be devastating. 

"There's no innocent parties in this except for the Canadian and American people and they're the ones that are going to pay all of the costs associated with all of the problems that are being generated as a result of this kind of controversy," he said.

In a series of social media posts, Trump claimed that the flow of drugs and illegal immigration were the reason for the tariffs. He added that they would stay in place, "until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!”

Durocher isn't sold on the idea that drugs and immigration is the reason behind Trump's threat of a trade war with its biggest customer. 

"This is a softball that Trump is throwing at the Canadian government. Trade has nothing to do with immigration or drugs coming over the border," he said. 

"I suspect there might be a little bit of a tariff just to make it look like they're being fair to all of their external partners, but when the US figures out that they import 60 per cent of their crude oil from Canada and then there's going to be a 25 per cent surcharge on that... Americans are going to be pretty upset because they are no longer going to be energy-independent like they say they are now."

Cambridge MP Bryan May also said that the Canadian government will do whatever it takes to protect its residents and their businesses.

"Our government is prepared to do whatever it takes to protect Canadian workers and manufacturers. The Prime Minister is meeting with Canada's Premiers to put a plan together that meets everyone's needs," said May in an email to CambridgeToday. 

"Justin Trudeau worked very well with president-elect Trump, and I have no doubt Canada and the United States will continue to make the right choices when it comes to trade."

May references Canada's retaliatory tariffs during a 2018 trade dispute with the United States, adding they "won't run from the challenge of new tariffs by the incoming administration."

Durocher believes the United States will back down from the big tariff talk and said like a lot of the rhetoric that should be taken seriously, it's most likely posturing. 

"But if it was at 25 per cent, it would be a very sad story for Canadians and Americans," he said. 

"Any Canadian that was out there saying 'Gee, I really hope Donald Trump gets elected' could be killing their own job.'"