Will Americans pay more for Manitoba canola, meds and machinery?

If U.S. president-elect Donald Trump follows through on his threat to slap 25 per cent tariffs on all Canadian imports, the general consensus among economists and political leaders is that nothing short of chaos is coming.

Manitoba Premier Wab Kinew said Tuesday the tariffs would plunge the province's economy into a recession. That may be an optimistic way to describe the simultaneous shocks created by runaway inflation, cratering consumer spending and massive losses by businesses of all sizes — which would be followed by mass layoffs if the private and public sectors can't figure out a way to manage the maelstrom.

One school of thought is that Trump is merely playing a game of brinksmanship with the U.S.A.'s biggest trading partner and would not jeopardize his own economy by threatening ours. If you subscribe to this somewhat comforting scenario, the U.S. disrupter-in-chief is simply doing what he says he's doing: trying to exact border and security demands from Canada. 

The problem is, Donald Trump is not predictable. There's no guarantee a collective Canadian effort to appease the president-elect or rally the most trade-dependent U.S. states and businesses to lobby Trump will succeed.

Justin Trudeau is also meeting with Canada's premiers on Wednesday in an attempt to put together a united front, but the unpopular prime minister has little political capital left to spend.

In other words, Manitobans, like all Canadians, have no choice but to consider what will be impacted by the tariffs. In 2023, this province exported $15.5 billion worth of goods and services to the U.S. 

Our biggest export to the U.S., in dollar terms, may surprise Manitobans. It's not canola, pork or farm machinery, but medications — both prescription and over the counter.

In 2023, Manitoba exported $2.3 billion worth of meds to the U.S., according to the Manitoba Bureau of Statistics. That included pharmaceuticals manufactured by major employers such as Bausch, in Steinbach, and Pfizer, in Brandon.

Andrea Ladouceur, president of the Bioscience Association of Manitoba, said she's used to pharma flying "kind of under the radar" in a province better known for agricultural production and manufacturing machinery.

It's uncertain what will happen to her sector when U.S. consumers have to pay far more for Manitoba-made meds, she said.

"That's what everyone's trying to grapple with," Ladouceur said Tuesday in an interview. "We know it's going to be very severe, but what does that mean?"

Ladouceur said some pharmaceutical manufacturers in Manitoba already have U.S. operations, which raises the spectre of companies shifting their production south of the border in order to remain solvent.

Manitoba's second-largest export to the U.S. is no surprise: canola. In 2023, $1.3 billion worth of the oilseed and its oil was sent south of the border.

The third-largest U.S.-bound export last year was electricity. Manitoba Hydro sold $702 million worth of power to the States in 2023 under deals brokered years before Trump was re-elected.