Calgary

Relief and uncertainty both mark Alberta industry reaction to U.S. tariff announcement

After Canada wasn't hit with additional tariffs on Wednesday, industry leaders said they wanted to see a return to normal business and work completed to strengthen Canada's economy and reduce its reliance on its southern neighbour.

Oil, agriculture and business leaders from around the province hope to see more stability

A file photo is pictured of pumpjacks.
Alberta and its oilpatch are hoping for a more stable path forward after more tariffs were not introduced by the U.S. against Canada on Wednesday. (Jeff McIntosh/The Canadian Press)

The long-awaited rollout of the new U.S. tariff policy, an occasion President Donald Trump marked with the moniker "Liberation Day," finally hit on Wednesday.

After bracing for the worst, some industry leaders are feeling relieved — and others, still uncertain.

Trump said the U.S. would apply a 10 per cent minimum baseline tariff on all goods coming into the U.S. from a long list of countries, with rates rising much higher for some nations. But that list did not include Canada because of previously announced tariffs that will continue to apply.

A man in a suit and red tie reaches for a red ball cap flying through the air.
Trump is pictured in the Rose Garden on Wednesday. (Carlos Barria/Reuters)

That means tariffs placed on Canadian steel and aluminum remain, while a levy on Canadian automobiles went into effect as of midnight on Wednesday. As well, tariffs on goods that don't comply with the Canada-United States-Mexico Agreement (CUSMA), which was negotiated in 2018, are still in place.

Adam Legge, president of the Business Council of Alberta, noted that Canada seemed to dodge the worst-case scenario that some feared, at least for now.

"For now, we're actually optimistic that we are not in the same scenario we thought we were January 20, and then February 2 and then March 4," Legge said, referring to previous U.S. tariff deadlines that had loomed over Canada.

Some industries, like the energy sector, are already largely CUSMA-compliant, Legge said. And tariff threats have encouraged more businesses to fill out the necessary paperwork to become compliant with the free trade agreement in recent months, he added.

Looking ahead, Legge stressed he hopes the Canadian federal government pauses to plot the best path forward on this issue, noting that some businesses are concerned retaliatory tariffs could be even more damaging than levies imposed by the U.S.

Instead, he advised letting self-inflicted wounds from U.S. tariffs persuade the country about how damaging the policy is — and strengthen Canada's own economy in the meantime.

"The relationship is strained and challenged, we're going to have to renegotiate [CUSMA], but the better and more important long-term strategy for Canada is, let's get our economic agenda together," Legge said. 

"Let's not breathe a sigh of relief and say we dodged a bullet. Let's continue to move forward for Canada for the best interest of the things we should have been doing for the past 10 years anyway."

Industries hoping for more stability

Canada's cattle industry was one sector heavily at risk due to tariffs, because of how integrated it is with the U.S. as products often require multiple trips back and forth over the border before beef reaches store shelves.

Dennis Laycraft, executive vice president of the Canadian Cattle Association, said he's relieved that the industry is largely already CUSMA-compliant

Now, the best thing for the industry is to move past the uncertainty that tariff threats have created, and return to a more normal business relationship with their partners around North America.

He added that the sector is already working on diversifying trade markets, with Canada Beef recently taking a month-long trip visiting several countries in the Indo-Pacific region to discuss strengthening trade relations.

"We certainly see the opportunity to grow our trade there, and all those countries are being hit by tariffs. There's an interest in doing more business with Canada," Laycraft said.

Greg Sears, a farmer north of Grande Prairie who's a director on the Alberta Grains board, said he'd be happy to see CUSMA continue given the certainty and stability it provides farmers.

But stability is not what the last couple months of U.S.-Canada trade relations has provided. He said that feeling didn't change Wednesday for some farmers.

"If we learned nothing [else] over the last couple of months, it's that the only thing that's certain is the uncertainty that's happening right now. I think we're hopeful with the most recent announcement, but the devil will be in the details," Sears said. 

"Things can change at any time, as we've seen."

Paul Colborne, president and CEO of the Calgary-based oil-focused exploration and production company Surge Energy, hopes that Canada can now use diplomacy to negotiate better with the U.S. and rebuild their relationship.

But he said he's disappointed to see what the friendship between the two countries has become.

"I feel saddened that our relationship with our 120-year trading partner, closest ally and the biggest, strongest economy in the world that benefits us greatly is being handled this way that we got to tariffs and countervailing tariffs," Colborne said.

Contrast in federal, provincial response

Alberta Premier Danielle Smith touted Wednesday's announcement as a win for her province and country, noting it appears the U.S. will uphold CUSMA until a newly-elected federal government can renegotiate a trade agreement in the spring.

"This is precisely what I have been advocating for from the U.S. administration for months," Smith wrote in an official statement on Wednesday, adding there's still work to be done on removing or reducing other previously announced tariffs.

After pausing his federal election campaign to meet with his cabinet in Ottawa, Liberal Leader Mark Carney noted that the U.S. had fundamentally changed the international trading system on Wednesday.

He also said the White House indicated it still may introduce tariffs in "strategic sectors" like pharmaceuticals, lumber or semiconductors.

He said Canada planned to fight U.S. tariffs with counter-measures.

"We're in a situation where there is going to be an impact on the U.S. economy which will build with time," Carney said. "The series of measures will directly affect millions of Canadians."

ABOUT THE AUTHOR

Andrew Jeffrey is a multimedia journalist with CBC Calgary. He previously worked for CBC News in his hometown of Edmonton, reported for the StarMetro Calgary, and worked as an editor for Toronto-based magazines Strategy and Realscreen. You can reach him at andrew.jeffrey@cbc.ca.

With files from Anis Heydari, Terri Trembath and Charles Delisle