A potential $93.8 billion hit over a five-year period: New study shows how Trump's tariffs could impact provincial economies — but there are opportunities elsewhere

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."

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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.

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.