Toronto ‘ready to do its part’ in taking on Trump tariffs

February 3, 2025 Canuck

With punishing tariffs on virtually all Canadian goods set to kick in Tuesday in the U.S., Toronto’s city government said it’s planning to review its procurement policies and contracts as part of a push to keep municipal dollars in the country.

Speaking at a news conference Monday, Toronto Mayor Olivia Chow says she’ll lead a “city-wide push to put our locally-made products and services first.”

Chow says she’s instructed the city manager to determine whether Toronto should end any contracts, as Ontario opted to do with Starlink, or follow in the province’s footsteps and ban U.S. companies from future government contracts.

“The City of Toronto buys a lot of goods. We do have a $78-billion budget,” said Chow, who will meet with Toronto’s city manager on Tuesday to go over what she calls a “Toronto Action Plan” for dealing with the tariffs.

“Every aspect of how this city operates matters,” she said. “It matters where we buy.”

Chow didn’t say how much of the city’s new budget is set to be spent on U.S. suppliers.

GTA businesses losing contracts

As the city plots its response to the U.S.’s historic tariffs, businesses around the GTA are already feeling economic pain.

Toronto Board of Trade president Giles Gherson told CBC Radio’s Metro Morning Monday that industries like plastics, chemicals and machine tools are being hurt first, since they’re unable to absorb the sudden 25 per cent tariff — and their American customers are unlikely to pay it.

“Contracts are going to be voided. And that’s what is starting to happen. Because in very few instances are the margins high enough to absorb a 25 per cent hit,” said Gherson.

WATCH | Tariffs expected to come into play Tuesday:

U.S. tariffs on Canadian imports set to come into effect Tuesday

3 hours ago

Duration 1:58

Prime Minister Justin Trudeau spoke to U.S. President Donald Trump early Monday morning about the forthcoming trade war that has the potential to inflict economic pain on workers and businesses on both sides of the border. Tariffs are set to take effect Tuesday.

That’s exactly what’s happened at Conquest Steel, a business in Toronto that produces products like raised garden beds and window wells.

Contract cancellations from U.S. buyers have already begun, said manager Rahim Moloo.

“Right off the bat … we’ve rolled our night shift into our day shift, because we couldn’t justify having the full night shift going on,” he said.

In a bid to keep all of his staff employed, Moloo says they are selling some products at cost to Canadian customers and hoping that there’s a general uptick in domestic interest in his wares.

“We’d like to see the government continue to push, embrace and support local manufacturing,” he said.

That’s something Toronto’s leadership has jumped on.

The ‘buy local’ push

On Monday, Chow joined other levels of government on the “buy Canadian” train, pledging to build a shop-local initiative to encourage individual consumers alongside its larger review of city contracts.

Mississauga is on the same wavelength, with Mayor Carolyn Parrish releasing a statement Monday encouraging residents to embrace Canadian products.

But economists are throwing cold water on the idea, questioning whether consumers changing their shopping habits would actually help safeguard jobs in Canada or force policy changes in the U.S.

“I admire the social cohesion that these policies encourage,” said Peter Morrow, an associate professor of economics at the University of Toronto.

“But I think the procurement policies are where the economic power is going to be.”

U of T economics professor Peter Morrow says Toronto city leadership should move slowly and thoughtfully as it plans a review of municipal contracts. (Alexis MacDonald)

Morrow also had some words of caution for the city as it prepares to re-evaluate — and possibly shred — some of its contracts.

As was the case with Mexico on Monday, tariffs can be pulled back or paused quickly.

“I would encourage [Toronto] not to pursue any policies that they are going to regret in one year’s time,” he said. “But also to understand they do have some economic power.”

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Canada News

Toronto ‘ready to do its part’ in taking on Trump tariffs

GTA businesses losing contracts

The ‘buy local’ push

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