Small and medium-sized businesses in the London area are facing increased challenges due to new steep tariffs imposed by the U.S. over the weekend. These tariffs, which are significantly higher than previous ones, are expected to have a severe impact on the region’s economy, according to an economic expert.
While previous tariffs under the Trump administration targeted broad sectors such as auto, steel, and aluminum, the latest 50 per cent levies, effective Saturday, impact a wide range of Canadian products including alcohol, honey, hockey sticks, and jewelry across various industries.
Mahmood Nanji, a policy fellow at Ivey Business School and former Ontario associate deputy finance minister, highlighted that these tariffs particularly affect small and medium-sized enterprises in London and those reliant on other producers. The economic expert expressed concerns that the tariffs could worsen London’s already fragile economy, leading to potential layoffs and hindering business investments.
The London Economic Development Corporation reported that approximately 700 businesses in London exported goods worth around $8 billion to the U.S. in 2023. Graham Henderson, CEO of the London Chamber of Commerce, emphasized that while the 50 per cent tariffs do not cover all of London’s exports, they impact a significant portion, accounting for about five percent of annual exports to the United States.
Melanie Pierce, owner of Seven Sisters Ritual Apothecary in downtown London, shared her concerns about the tariffs affecting her business, which caters to American clientele. She indicated that the tariffs would likely reduce online sales, which are a substantial part of her business revenue.
Pierce, like other local merchants, has already faced challenges adapting to changing regulations, such as the removal of the de minimis exemption allowing duty-free entry of goods under $800 into the U.S. She mentioned the additional paperwork and complexities involved in shipping to the U.S., which have created operational hurdles for her business.
Looking ahead, Pierce is exploring strategies to mitigate the impact of the tariffs by focusing on boosting domestic sales and investing in local advertising to compensate for any potential decline in U.S. demand.