A promised $500 tax rebate cheque to every working British Columbian is on the chopping block if the incoming United States administration under president-elect Donald Trump imposes tariffs on Canadian products, B.C. Premier David Eby said Thursday.
Additionally, a planned review of government programs within each ministry has “taken on new meaning in the face of tariff threats,” said Eby at a press conference in downtown Vancouver.
In terms of the $1.8-billion rebate, promised last October during the provincial election, and in terms of any government spending review, Eby said "our number one priority right now is protecting B.C. families from this threat," adding “everything is on the table,” from retaliatory policies and government measures to reducing spending in preparation of economic decline.
“We don’t want to spend money on administration; we want to spend money on frontline services,” said Eby.
The premier called the tariff threat “serious” and amounting to “economic warfare,” immediately plunging the province into a recession once Americans cancel their import orders.
Eby and Minister of Finance Brenda Bailey outlined GDP estimates under a 25 per cent tariff scenario.
The province’s GDP stands at $336 billion today and would only rise to $345 billion by 2028, not $366 billion under normal circumstances. To 2028, the province would lose $69 billion in cumulative GDP output amounting to 124,000 fewer jobs.
Trump has expressed displeasure with Canadian border security, including fentanyl production and distribution and illegal immigration. Trump has stated the U.S. does not need Canadian products, suggesting the tariffs will not harm Americans but help create jobs south of the border.
Eby disagreed with that notion, suggesting Americans use cheap B.C. energy.
“Mutually assured destruction is no path to prosperity,” said Eby, adding California avoids blackouts thanks to B.C. electricity.
If tariffs are imposed, Eby said he is open to supporting a federal response to halt energy exports to the U.S.
Noting provincial governments do not have the power to impose tariffs, Eby said there are many things B.C. does at a provincial level that could improve the economy or disrupt American activity here.
Eby said premiers are committed to reducing inter-provincial trade barriers.
Eby also cited U.S. wine sales in stores and allowing American trucks to pass freely to and from Alaska as two examples of cooperation that could be “on the table” to re-examine.
Eby also said B.C. could look elsewhere to sell energy and critical minerals used for U.S. military development and artificial intelligence.
The premier said the provincial government will begin exploring trade diversification, noting with some relief that B.C. is less dependent on the U.S. than the rest of Canada.
The U.S. remains by far the largest trading partner for B.C., accounting for 54 per cent of exports, as compared to 75 per cent across Canada.
But China accounts for 14.1 per cent of exports; then comes Japan at 11.1 per cent and other Asian countries at 10.2 per cent.
Glacier Media asked Eby what countries he would turn to and, specifically, if China will play a bigger role.
Eby said his diversification efforts would look to create more space between B.C. and both China and the U.S.
“We are dependent on two countries that are in intense disagreement with one another and, as well, are in positions of conducting themselves that are causing concerns globally,” said Eby, while naming Japan, South Korea, Vietnam, Philippines and India as targets.
But the prospect of B.C. and Canada purposefully or inadvertently furthering economic ties with China is another matter that “puzzles” Eby with respect to the tariff threat.
“This is the puzzle, from my perspective, of the actions of the Americans. They say that their dominant concern is China, is the importation of precursor chemicals related to fentanyl, the buildup of military belligerence on the part of that country as well as the dumping of products into the United States. I mean, what better ally is there to the United States in establishing critical mineral chains independent of China, than Canada? What better partner is there to ensure the energy is there around artificial intelligence as well as any other priorities, than Canada?
“It's bizarre to me we’re having this conversation. It is solely to the benefit of China that Canada and the United States are feuding,” said Eby.
Eby said his number one tool as a premier is diplomacy and he will be travelling to Washington soon to meet with U.S. officials, alongside premiers.
“If we can help deliver that message to the president-elect, to Republicans, then I think we can reinforce we are actually allies in this challenging global environment we’re living in,” he said.
Eby also encouraged British Columbians to reconsider vacationing in the U.S. should tariffs be imposed.
