A Challenging Turn

This past week has been a challenging one for Canada on many fronts. The President of the United States continues to announce new tariff threats directed specifically at Canada, while little progress appears to be made at the negotiating table.

Domestically, wildfire conditions across many Canadian provinces remain severe, with resources being stretched to unprecedented limits. Locally, in communities such as West Kelowna, adding insult to injury, some fires are being set intentionally through acts of arson.

The recent heat wave is also posing a serious threat to many people with health conditions, a situation further compounded by wildfire smoke that has drifted into the valley from other regions.

In short, these are challenging times for many Canadians. The potential threat of expanded retaliatory tariffs from the United States also has an Okanagan connection, as the proposal would impose a 50 per cent tariff on Canadian-produced beer, wine, and spirits.

The United States claims this measure is in retaliation for the decision by many Canadian provincial liquor boards to stop selling American-produced beer, wine, and spirits in liquor stores across Canada.

The latest U.S. tariff threat also references Canada’s dairy supply management system, as well as tariffs affecting U.S.-produced vehicles imported into Canada. In both cases, the United States believes it is being subjected to punitive trade policies that are not applied to other countries.

To be clear, U.S. tariffs mean that these Canadian-produced goods, when imported into the United States, will have additional costs imposed on them, making them more expensive for American consumers to purchase.

This has the potential to increase inflation in the United States, ultimately costing American consumers more money while reducing competition in the retail marketplace.

However, if those tariffs lead American consumers to purchase goods manufactured domestically in the United States—or imported from other countries such as Mexico—it could result in lost jobs and economic activity for Canadian industries that depend on export markets.

This is not unlike what has happened to American producers of beer, wine, and spirits selling into Canada. The boycott of these U.S.-produced products by the majority of Canadian provincial liquor control boards has resulted in imports of American alcoholic beverages into Canada decreasing by roughly 80 per cent. In terms of sales volume, that represents a decline from approximately $718 million to $136 million in a single calendar year.

I mention this because it is important to recognize that there are few “winners” in a trade war. In reality, losses on both sides of the border can result in fewer jobs and reduced economic activity. This is also why it is critically important to ensure that internal trade barriers between provinces are minimized wherever possible.

As the Official Conservative Opposition, we are calling for the International Trade Committee to convene and hear the government’s plan to prevent these new tariffs from taking effect and to fight for tariff-free trade.

At this point, I do not believe it is clear what the federal government’s plan or strategy is for dealing with our largest trading partner.

I do believe that Canadians have proven time and again that we can compete with the very best in the world and succeed.

Trade is a complicated subject with many different perspectives and opinions—one in which scoring political points can come at the expense of implementing policies that would benefit both sides of the border.

My question this week is: How concerned are you about the current status of our trading relationship with the United States?

Your feedback helps me do my job. As always, you are welcome to share your thoughts on my Facebook page, by email at Dan.Albas@parl.gc.ca, or by calling toll-free at 1-800-665-8711.