Mar 12, 2025
The ever-increasing threat of tariffs from our southern neighbour seems to be the only thing on people’s minds these days. While their implementation has been more on-again, off-again, in the first few months of 2025, their full impact would be financially burdensome for Canadian businesses across all sectors.
A new analysis from the Public Policy Forum conducted by Navius Research examines the potential impact on each province, as well as how Canada may be able to hit back via retaliatory tariffs.
Advertisement
"We undertook this study to provide quantitative guidance to policymakers in real-time," Inez Jabalpurwala, the forum’s president and CEO, said in a statement.
"The work reveals emergent areas of focus for Canadian leaders, including the urgent development of east-west, and west-east trade in Canada and beyond."
Sectors in every province would experience a form of decline, from gasoline and diesel refined in New Brunswick, aluminium exports from Quebec, steel and automobiles from Ontario, potash and uranium from Saskatchewan and oil and gas from Alberta.
What may actually happen if these tariffs are implemented?
The sector that will be most impacted by President Trump's tariffs is vehicle manufacturing, potentially enduring a $93.8 billion hit in Ontario over a five-year period, while Quebec's aluminum industry would stand to lose $12.7 billion over the same time frame.
However, the news is not all gloom and doom for Canadians. The report notes that sectors that are primarily trading between nationally or with Asia and Europe may be insulated from US tariffs and may actually experience growth during this period.
"Sectors with access to broader markets, such as offshore oil production in Newfoundland and LNG (liquid natural gas) production on the west coast, may actually benefit from tariffs," said Jotham Peters, managing partner at Navius Research, "which might be a guide for how Canada can insulate its economy in the future."
"Greater trade networks to either the east or west coast will help insulate Canada from trade shocks with the US and can act as leverage for the next tariff threat."
Must Read
- Stop the leak: 5 costs Canadians (still) overpay for every single month. How many are sabotaging your 2026 budget?
- What's your worth? Here are the 3 net worth milestones that change everything for Canadians (and what they say about you)
- Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich — and that ‘anyone’ can do it
And what happens if Canada hits back?
On the flipside, Public Policy Forum's analysis of the effects of a 25% retaliatory tariff on imports of 23 classes of US goods into Canada reveals more significant damage to the US than to Canada.
Advertisement
Some of the impacted industries include: food, pharmaceuticals, fabricated metals, alcohol and tobacco, manufactured goods, steel, plastics, cement, non-ferrous metals, paper, mining products, clothes and wood products.
The report also reveals how tariffs on some sectors would benefit Canada more than the US — the first being Canada has adequate opportunities to substitute away from US goods, such as with alcohol imports.
Secondly, there are certain industries that may be negatively impacted by US tariffs but have sufficient production capacity to meet needs across the country, such as steel in Ontario and Quebec.
The forum recommends avoiding tariffs on goods that rely on a highly integrated supply chain between the two countries, such as vehicles.
Furthermore, Canada would do itself more harm if it retaliates with tariffs on oil, electric products, raw wood, natural gas, chemicals, refined petroleum, machinery, biofuels, agriculture and vehicles.
You May Also Like
- Here’s how to retire in 10 short years no matter where you live in Canada — even if you’re starting with $0 savings
- If you’re still feeling the pinch this month — don’t panic. Here are 5 easy ways to fix your finances without a total overhaul
- How Warren Buffett’s simple buy-and-hold real estate approach offers a lesson for Canadian homeowners and long-term investors
- Approaching retirement with no savings? Don’t panic, you're not alone. Here are easy ways you can catch up (and fast)
Nicholas completed his master's in journalism and communications at Western University. Since then, he's worked as a reporter at the Financial Post, Healthing.ca, Sustainable Biz Canada and more. Aside from reporting, he also has experience in web production, social media management, photography and video production. His work can also be found in the Toronto Star, Yahoo Finance Canada, Electric Autonomy Canada and Exclaim among others.
Managing Money • Mar 06
