With the administration of U.S. President Donald Trump re-asserting that a 25 per cent tariff on all Canadian imports could take effect on Tuesday, Saskatchewan’s economy is bracing for the impact. Golden West Business Commentator Paul Martin weighed in on what this could mean for the province and Canada as a whole.
Martin emphasized that while details remain uncertain, the immediate consequence would be a price increase on all Canadian goods entering the United States.
“Everything we ship just got 25% more expensive to the end user in the United States,” Martin stated. This could lead to American buyers seeking alternative suppliers, reducing demand for Canadian exports.
Among Saskatchewan’s key industries, potash and oil could face significant challenges. While potash may not see an immediate drop in demand due to limited alternative suppliers—Russia and Belarus remain under sanctions—oil is a different story.
“Certainly we are not an exclusive supplier on that one. America has lots of options on that,” Martin explained. If Canadian oil becomes 25 per cent more expensive, U.S. buyers could turn to Venezuela or the Middle East, potentially reducing exports and forcing Canadian producers to either lower prices or cut production.
The sliding Canadian dollar could play a role in offsetting some of the impact, but not without consequences.
“I’ve even heard people say maybe we almost offset the value of the tariff with the devaluation of the currency,” Martin noted. However, a weaker Canadian dollar also raises import costs, fueling inflation, which could lead to increased interest rates—a situation Canada’s already sputtering economy would struggle to handle.
The effects of the tariffs could also be felt at the gas pump. With much of Canada’s oil being refined in the U.S. and then sold back to Canadian markets, a price spike is possible.
“If Canada retaliates and we put a comparable tariff on this side to penalize the Americans, isn’t it ironic we would be penalized going down, we’d be penalized coming back?” Martin observed. This could create regional disparities in fuel prices, particularly between Ontario and Saskatchewan.
The tariffs also revive long-standing debates over Canada’s energy independence.
“Quebec’s still importing oil, for example, from Saudi Arabia. Should that be replaced with Saskatchewan- or Alberta-produced crude?” Martin asked. The challenge of building pipelines and overcoming regional resistance to a national energy strategy has been debated for decades. “Wouldn’t it be ironic if it was the President of the United States who got the Canadians to actually get over that hump and figure out how to create a national Canada policy where oil produced in this country was consumed in this country?” he added.