Trump’s trade tariffs would send Manitoba into a recession: Premier Wab Kinew

Posted on November 26, 2024 by Peggy

The damage to Manitoba from a 25 per cent tariff on Canadian goods entering the U.S. cannot be overstated, Premier Wab Kinew says.

“The bottom line is it would mean a recession for our province and we can’t have that happen,” he told reporters on Tuesday, following an address at the Association of Manitoba Municipalities fall convention in Winnipeg, where he told delegates ever province is united in working to fight U.S. president-elect Donald Trump’s threatened sanctions.

However, the federal government needs to step up with money to make it happen and address some of Trump’s concerns, Kinew said: “We have to show the Americans that we’re serious about border security.”

Trump announced Monday evening that he’ll slap a sweeping 25 per cent tariff on all products entering the U.S. from Canada and Mexico unless those countries rein in what he says is a flow of drugs and migrants across their shared borders with the U.S.

The economic sanctions would begin Jan. 20, 2025, the day of Trump’s inauguration.

“That is a huge impact, so that’s something that we can’t allow,” Kinew said.

A man with short grey hair and eyeglasses wears a tan suit — Manitoba Chambers of Commerce president Chuck Davidson says Manitoba needs to get its close U.S. trading partners on side by stressing the impact tariffs will have on them. (Megan Goddard/Radio-Canada)

The U.S. is Canada’s largest trading partner with nearly 77 per cent of Canadian exports going there.

For Manitoba, it’s about 73 per cent, which equates to about $15 billion annually, according to Chuck Davidson, president and CEO of the Manitoba Chambers of Commerce.

“We were concerned when the discussion [about a potential tariff] was about 10 per cent,” which the Canadian Chamber of Commerce found would cost the Canadian economy $30 billion annually, he told CBC Manitoba Information Radio host Marcy Markusa on Tuesday.

“This is going to have a significant impact on the Canadian economy if this goes forward. We need to make sure this is the number one concern of both our provincial and federal governments, to do whatever possible to lessen the impact of this.”

There are things Canada needs to do that are being asked of it, Kinew said.

“We’ve gotta have strong border security and we have to bring the hammer down on drug trafficking,” he said, adding in order to make that happen the federal government must address the RCMP staff shortage.

President-elect Donald Trump arrives to speak at a meeting of the House GOP conference, Wednesday, Nov. 13, 2024, in Washington. — U.S. president-elect Donald Trump threatened Monday evening to slap a 25 per cent tariff on all products entering the country from Canada and Mexico on Jan. 20, 2025, his inauguration day, unless those countries curb the flow of drugs and migrants across their borders. (AP/Alex Brandon)

According to Kinew, the RCMP have said they have the necessary applicants but need the processing sped up to get the applicants into training and then deployed into communities.

Once that’s addressed, “we’re more than happy to play our part,” Kinew said.

“We’re going to be able to have the resources to have drones intercept drug trafficking, we’re gonna have the resources to keep a better eye on the [border] ports. We’re gonna have the resources … in terms of holding people accountable in local communities right across Manitoba.”

Those moves will not only help address public safety and the addictions crisis in Manitoba, but also benefit the economy by, it’s hoped, preventing imposition of the tariff, Kinew said.

Canada must also meet the two per cent NATO target, almost doubling annual defence spending to $81.9 billion, in order to appease the U.S., the premier said.

“If Canada is not upholding our obligation, in terms of what we invest in the Canadian Armed Forces, the Trump administration is going to use that as something to hit us over the head with in the trade conversation.”

Davidson says Manitoba needs to get its close U.S. trading partners on side by stressing the impact tariffs will have on them.

“It’s going to be critical minerals, it’s going to be manufacturing, it’s going to be egg products, it’s going to be energy,” he said. “All of those are companies … doing cross-border [business] on a daily basis, so that’s where some of the pressure and some of the negotiations need to take place — with the individual states. They need to understand.”

Davidson specifically cited Minnesota, Ohio, Georgia, and Tennessee. The latter is one of the biggest trading partners with Manitoba in regards to pharmaceutical products going into that state, he said.

“It’s a no-win situation for either country.”