For local business and economic development leaders who believe timing is everything, and most all do, Market Hall in Peterborough’s downtown core was the place to be early Tuesday morning (March 4).
Just hours after the Trump administration imposed long-threatened tariffs on Canadian exports to the United States, a free panel event titled “Bridging The Divide: Future-Proofing Your Business Against U.S. Tariffs” went ahead as scheduled against the backdrop of much economic uncertainty and more questions than answers.
Co-hosted by Community Futures Peterborough, the Peterborough and Kawarthas Chamber of Commerce, and the Peterborough Downtown Business Improvement Association (DBIA), the event featured a panel of experts in the areas of trade, finance, and supply chain management.
Keynote speaker Bob Armstrong, the president of Lindsay-based Armstrong Trade and Logistics Advisory Services, was joined on the panel by CIBC Wood Gundy advisor and portfolio manager Andrew Pyle, Trent University economics professor Dr. Saud Choudry, and Sherry Hill, chief financial officer of Peterboro Matboards and secretary of the Kawartha Manufacturers Association.
While each didn’t downplay the very serious threat to Canadian, provincial, and local economies posed by U.S. President Donald Trump’s imposition of a 25 per cent tariff on Canadian goods, they collectively left their audience of about 100 people with a clear message: now is the time to come together.
With more than 50 years’ experience in global supply chain, international trade, cross-border logistics, and customs regulations matters, and having led numerous Canadian trade missions, Armstrong knows of what he speaks and, on this morning, his words clearly resonated during an event-opening one-on-one conversation with Pyle.
Noting that “a lot of businesses in Canada sat back, thinking he (Trump) is all talk and no action,” Armstrong lamented a lack of preparation for this very eventuality, such as the removal of interprovincial trade barriers.
“Trade across Canada between provinces is about $450 billion, compared to during COVID when our trade with the U.S. was $750 billion, so we don’t have significant trade (between provinces),” said Armstrong.
“But we need to remove (interprovincial trade) barriers as quickly as we can (for) those who are exporting to the United States and are worried that their customers are going to cut them off,” he said. “You’ve got to have somewhere to sell your products. But, again, that doesn’t happen overnight. This should have been solved long ago.”
“Right now, a truck can’t run from Halifax to Saskatchewan without unloading for weight scales … silly little things like the number of wheels you’ve got to have on your truck or the number of hours you can drive. All these silly things should get rectified so it’s simple.”
Armstrong said who he feels particularly bad is for small retailers who, having purchased products from wholesalers and distributors, already have items from the U.S. on their shelves.
“Their margins are slim. Are we going to ask them to take those products off their shelves and (still be able to) eat? They paid for it. How do we help them? They’re the ones who are going to suffer.”
“The big retailers can pull it (U.S. product) off the shelves. The LCBO … it’ll just put the (American) booze in the cupboard until this all blows over and then put It back on the shelves. It’s the small retailers that can’t do that that I worry about.”
Asked what steps government should be taking to help small and medium-sized businesses, Armstrong suggested “some kind of financing or a huge tax break” would be in order. Whatever form any assistance takes, he adds it needs to happen “now, not a year from now.”
Pressed by Pyle on whether he thinks government, at both the provincial and federal levels, acted too late on the tariff threat, Armstrong said measures to alleviate the impact “should have started back in the early fall when Trump was again running for president.”
In addition to the removal of interprovincial trade barriers, Armstrong said it’s imperative that Canada again embark on a series of trade missions to secure new markets for its products. He recounted his own experience on numerous trade missions that saw Canadian businesses secure new contracts with regularity.
For his part, Dr. Choudry prefaced his remarks with a paraphrase of a famous utterance by former Canadian prime minister Pierre Elliott Trudeau in a 1969 speech at the National Press Club in Washington D.C.: “Living next to you is, in some ways, like sleeping with an elephant. No matter how friendly and even-tempered the beast, one is affected by every twitch and grunt.”
That added some welcome levity to an atmosphere brimming with serious concerns.
Turning to the matter at hand, Dr. Choudry opined “It’s not all doom and gloom yet,” adding “There are certain areas where Canada has an enormous advantage. Those happen to be areas where we can hurt the Americans the most.”
“The one that comes to mind is potash. Canada produces one third of all potash in the world. Potash is an essential ingredient in the production of chemical fertilizers, which we are so dependent on these days. The price of fertilizers is going to up by 35 per cent because of the tariff on potash.”
That, said Dr. Choudry, is a hugely increased cost that American farmers can’t absorb at the best of the times, further suggesting the Trump administration can expect major push back from the U.S. agricultural sector.
Following the panel, Hill told kawarthaNOW that local manufacturers have “to look at their own situation” but noted “There’s a lot of help too.”
“We (the Kawartha Manufacturers Association) just had a round table and what we found is when people started connecting and saying ‘I’m having this problem because I need this and I can’t get it’, all of a sudden a partnership was made where they can have revenues with that person — but they just didn’t know they could, because they didn’t know what other people do.”
“Finding new sources of revenue in 30 days is just not possible. When you sell into multiple countries, there’s no more sales to obtain, so where do you go for more sales? You have to figure out a way of ‘How can I still sell to the U.S., keep my pricing in place, and not take the hit of having to lay off employees?'”
Armstrong, meanwhile, echoed what he said during his presentation.
“We’ve got to get all the provinces to agree to drop whatever rules and regulations they have that impact trade from another province,” he said. “They need to get moving. We’ve been fighting this battle for years. Now’s the time to resolve it.”
Armstrong, however, retains his optimism that the Trump tariffs will run their course before being lifted.
“It will all come crashing down,” he predicted. “Sooner or later, in the United States, the consumer wakes up. When the stock market crashes, those big rich guys — his (Trump’s) buddies — are going to say ‘What are you doing here?'”
“I don’t think this will last longer than five months. It could be less. If the auto industry shuts down, and he’s got a million workers unemployed, something’s going to happen.”
