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Understanding the Tariff Threat
The recent announcement of potential U.S. tariffs on Canadian goods has sent shockwaves through Saint John, New Brunswick. As the city braces for what could be a significant economic downturn, local leaders are voicing their concerns about the implications of these tariffs.
Fraser Walls, chair of the Saint John Chamber of Commerce, emphasized that the tariffs would not only inflate prices on both sides of the border but also create a challenging economic environment for households. The looming tariffs, initially set to take effect on February 1, were temporarily paused after a phone call between U.S.
President Donald Trump and Canadian Prime Minister Justin Trudeau. However, the uncertainty remains, and businesses are left to navigate the potential fallout.
Saint John’s Vulnerability
According to research conducted by the Canadian Chamber of Commerce, Saint John is identified as the most vulnerable city in Canada regarding the impact of U.S.
tariffs. The city is home to the Irving Oil refinery, the largest crude oil refinery in the country, which processes over 320,000 barrels of oil daily, with a significant portion exported to the U.S. The refinery’s statement highlighted the long-standing relationship with American customers and warned that tariffs would lead to price increases, affecting energy security and the broader economy.
This situation underscores the interconnectedness of the Canadian and U.S. economies, particularly in industries like energy, seafood, and forestry.
Economic Implications and Opportunities
The potential economic impact on Saint John could reach multi-billion dollar proportions, as noted by Walls.
In 2023, New Brunswick exported $15.5 billion worth of goods to the U.S., with a substantial portion originating from Saint John. This reliance on the U.S. market raises questions about the sustainability of the local economy in the face of tariffs.
However, some local leaders, like Saint John Councillor Brent Harris, see an opportunity for the city to repatriate its supply chains. With a deep-water port and an underutilized airport, Saint John has the potential to expand its cargo facilities and reduce its dependence on the U.S. market. Harris advocates for investment in these areas to capitalize on the city’s competitive advantages.
