In anticipation of tariffs on Canadian goods in the U.S., Toronto’s city government said Monday it was planning to review its procurement policies and contracts as part of a push to keep municipal dollars in the country.
Following a phone call with Prime Minister Justin Trudeau, President Donald Trump promised to hold off on levying tariffs on Canada for at least 30 days. Had the pause not been agreed to, the tariffs would have kicked in on Tuesday.
Speaking at a news conference Monday prior to news of the pause, Toronto Mayor Olivia Chow she would lead a “city-wide push to put our locally-made products and services first.”
Chow said she 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 said she would 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.
Following news that the tariffs would be put off by at least 30 days, CBC Toronto spoke with the mayor’s media representative, who confirmed that the plan Chow laid out on Monday morning still stood — and that her meeting with the city manager Tuesday would go ahead as planned.
GTA businesses lost contracts
Businesses around the GTA had already reported they were already feeling economic pain.
Toronto Board of Trade president Giles Gherson told CBC Radio’s Metro Morning on Monday morning that industries like plastics, chemicals and machine tools were hurting, since they would be 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.
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.
Some U.S. buyers already cancelled their contracts, said manager Rahim Moloo on Monday morning, also prior to Trump’s late Monday reversal.
“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 were planning to sell some products at cost to Canadian customers and hoped 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 jumped on in its plan.
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 was on the same wavelength, with Mayor Carolyn Parrish releasing a statement Monday encouraging residents to embrace Canadian products.
But economists threw 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.”