Manufacturer Information Hub – Trade & Tariffs
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CME IS KEEPING MEMBERS IN THE KNOW
The Trump administration has released a broad-based memorandum on their vision for an ‘America First Trade Policy.’ Among other things in the document that could impact Canada, the memorandum calls for the U.S. Departments of Commerce and Treasury and the U.S. Trade Representative (USTR) to investigate the source of annual trade deficits and make recommendations, including the imposition of tariffs, to address them. CME will continue to provide timely updates and expert analysis to help manufacturers navigate these challenges.
IN THE NEWS
CME is working hard to ensure your issues are front and centre in the media, using our insights and position as the voice of manufacturing to shape the conversation, including featured coverage in the:
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ANOTHER (PARTIAL) TARIFF PAUSE
On Thursday, March 6th, the U.S. administration again reversed course on tariffs, further pausing the 25 per cent tariff through April 2nd for all USMCA compliant goods. While a delay on tariff increases for some goods is positive, this decision adds yet more complexity and uncertainty to Canada-U.S. trade.
ANNOUNCED FEDERAL SUPPORTS FOR BUSINESSES AND EMPLOYEES
On March 7, the government announced federal measures to support businesses and workers. Measures include:
- Launching the Trade Impact Program through Export Development Canada. The program will deploy $5 billion over two years, starting this year, to help exporters reach new markets for Canadian products and help companies navigate the economic challenges imposed by the tariffs, including losses from non-payment, currency fluctuations, lack of access to cash flows, and barriers to expansion.
- Making $500 million in favourably priced loans available through the Business Development Bank of Canada to support impacted businesses in sectors directly targeted by tariffs, as well as companies in their supply chains. Businesses will also benefit from advisory services in areas such as financial management and market diversification.
- Providing $1 billion in new financing through Farm Credit Canada to reduce financial barriers for the Canadian agriculture and food industry. This lending offer will help address cash flow challenges so that businesses can adjust to a new operating environment and continue to supply the high-quality agricultural and food products that Canadians rely on.
- Introducing temporary flexibilities to the EI Work-Sharing Program to increase access and maximum agreement duration. The Work-Sharing Program provides EI benefits to employees who agree with their employer to work reduced hours due to a decrease in business activity beyond their employer’s control to help retain employees and avoid layoffs.
In the days and weeks ahead, CME will continue advocating for strong, direct support for manufacturers that will be most affected by tariffs beyond the measures noted above.
CANADA’S RETALIATORY TARIFFS
In response to the U.S action, the federal government has implemented retaliatory measures. The first phase of Canada's response includes tariffs on $30 billion in goods imported from the U.S., effective March 4. The list includes products such as orange juice, peanut butter, wine, spirits, beer, coffee, appliances, apparel, footwear, motorcycles, cosmetics, and certain pulp and paper products. The government also announced that, should the U.S. continue to apply unjustified tariffs on Canada, the government intends to impose additional countermeasures on $125 billion in imports from the U.S., drawing from a list of goods open for a 21-day comment period, which would bring the scope of countermeasures to a total of $155 billion worth of products. This list includes products such as electric vehicles, fruits and vegetables, beef, pork, dairy, electronics, steel, aluminum, trucks, and buses. Manufacturers can provide comments on the federal governments proposed tariff measures directly to Finance Canada: consultations@fin.gc.ca.
TARIFF REMISSIONS PROCESS
Finance Canada has outlined a discretionary remission process for Canadian importers that may be impacted by Canada’s retaliatory tariffs. The remission process applies to the first round of Canada’s retaliatory tariffs and all future tariffs. The federal government is considering requests for remission in these two instances: 1) Situations where goods used as inputs cannot be sourced domestically, either on a national or regional basis, or reasonably from non-U.S. sources; and 2) To address, on a case-by-case basis, other exceptional circumstances that could have severe adverse impacts on the Canadian economy. Questions or remissions requests should be made directly to Finance Canada at remissions-remises@fin.gc.ca.
Reciprocal Tariffs Announced, Assessment To Be Completed by April 1
On February 13, 2025, President Trump signed a presidential memorandum which announced a framework “reciprocal” tariffs on other trading partners across the world. The memo outlines out a process for the U.S. to impose reciprocal tariffs on other countries, effectively raising tariffs on a country’s exports to the U.S. based on the level of tariff and non-tariff barriers that country imposes on U.S. goods. All countries who trade with the U.S., including Canada and Mexico, will be included in this assessment, to be completed by April 1. This would provide President Trump the opportunity to introduce reciprocal tariffs or other non-tariff measures as early as April 2.
CME Condemns New Tariffs on Steel, Aluminium Imports from Canada
CME condemns the U.S. administration’s unjustified decision on Feb 10 to impose new tariffs on imports of steel and aluminium from Canada. This decision is yet another move that significantly undermines one of the most successful economic partnerships in the world. The proposed tariff measures will harm consumers, businesses and workers on both sides of the border.
WORKING ACROSS BORDERS
We’re working with our counterparts at the National Association of Manufacturers (NAM) to emphasize the economic damage these tariffs will cause on both sides of the border. A recent NAM press release stresses that "A 25% tariff on Canada and Mexico threatens to upend the very supply chains that have made U.S. manufacturing more competitive globally. The ripple effects will be severe, particularly for small and medium-sized manufacturers that lack the flexibility and capital to rapidly find alternative suppliers or absorb skyrocketing energy costs. These businesses—employing millions of American workers—will face significant disruptions. Ultimately, manufacturers will bear the brunt of these tariffs, undermining our ability to sell our products at a competitive price and putting American jobs at risk."
ADVOCATING FOR RELIEF MEASURES
CME will continue to advocate for urgent policies that will safeguard Canadian businesses, workers and their families. We’re working with all levels of government to engage U.S. officials and push for an immediate rollback of these misguided and damaging tariffs and pursuing urgent relief by advocating for direct federal and provincial support for manufacturers and workers impacted by these measures. During past crises, including steel & aluminum tariffs, the COVID-19 pandemic and more, CME successfully advocated for relief measures, and we will do so again for you.
By the Numbers
IMPACT ON MANUFACTURERS
In December, CME consulted more than 300 manufacturers coast to coast on the impact of proposed tariffs to their business. Nine in ten Canadian manufacturers would face significant or very severe impacts on their business if the U.S. imposes tariffs on Canadian imports. Business impacts will worsen once tariffs are implemented with 48 per cent of manufacturers considering a hiring freeze or laying off workers, 46 per cent considering postponing or cancelling planned capital investments and 49 per cent considering shifting some production to the U.S.
Manufacturing Fast Facts
The manufacturing sector represents more than 10% of Canada’s gross domestic product.
Manufacturers directly support more than 1.7 million jobs in Canada.