“Southwestern Ontario, the country’s energy centres, and parts of Quebec are going to be hit a lot harder than the Ottawa region,” says the study’s author.
A new study that examines the economic impact of U.S. tariffs on Canadian cities suggests Ottawa-Gatineau will be relatively well placed to withstand the threatened trade turbulence.
The Canadian Chamber of Commerce study assesses the potential impact of U.S. President Donald Trump’s tariffs on 41 Canadian cities.
It shows cities with economies that rely on crude oil exports, automobile and parts manufacturing are the most likely to suffer because of tariffs. Saint John, N.B., Calgary, Windsor, Kitchener-Cambridge-Waterloo and Brantford top the list of Canada’s most tariff-vulnerable cities.
Ottawa-Gatineau ranked 29th on the list of 41 Canadian cities.
The National Capital Region’s tariff exposure was 10.9 per cent below that of the average Canadian city, the study found.
Ottawa-Gatineau is home to 812 export firms, which produced $8 billion worth of goods in 2023. They were responsible for 8.4 per cent of the region’s economic output.
“Ottawa’s economy isn’t as trade exposed. It’s obviously much more focused on high tech and public sector government jobs,” study author Stephen Tapp, the chamber’s chief economist, said in an interview.
“That’s not to say there’s no tariff impacts on Ottawa-Gatineau, but I would say that southwestern Ontario, the country’s energy centres, and parts of Quebec are going to be hit a lot harder than the Ottawa region.”
Earlier this month, Trump agreed to pause for 30 days his executive order imposing a 10 per cent tariff on Canadian energy exports and a 25 per cent tariff on all other Canadian exports.
The Canadian Chamber of Commerce used granular Statistics Canada data to predict which Canadian cities will be most affected by those tariffs. It examined economic data for the 41 census metropolitan areas (CMAs) in Canada with more than 100,000 people.
Evening Update
Researchers built a “U.S. tariff exposure index” to reflect both the export intensity of each city’s economy and its dependence on the U.S. as a buyer for those goods.
“Our modelling estimates that the tariff will impose the steepest hit for the value of Canada’s energy exports, which explains why the highest vulnerabilities are for Saint John, New Brunswick and Calgary, Alberta,” the study concluded.
Canadian energy exports to the U.S. were worth more than $176 billion in 2024.
Saint John is home to the Irving Oil Refinery, the largest crude oil refinery in Canada, which can process more than 320,000 barrels a day. More than 80 per cent of that output is exported to the U.S. New Brunswick’s seafood and forestry products are also vulnerable to tariffs.
Cities in southern Ontario, including Windsor, Kitchener, Waterloo, Cambridge, Brantford, Guelph and Hamilton, also score high on the tariff vulnerability index because of their reliance on car parts and steel manufacturing.
Windsor is home to assembly plants for Ford and Stellantis, while Linamar, Canada’s second largest auto parts maker, is headquartered in Guelph. Hamilton is the steel capital of Canada with plants operated by ArcelorMittal Dofasco and Stelco.
Quebec is also home to three cities with higher-than-average tariff risk, including Saguenay-Lac-Saint-Jean, which is responsible for about one-third of Canada’s aluminum production. Most of that (85 per cent) is exported to the U.S. Trois-Rivières handles aluminum, forestry and agri-food products, while Drummondville is a sizable exporter of wood products and furniture to the U.S.
Tapp, the chamber’s senior vice-president of research, data and analytics, said his team is now working to understand how Canada’s retaliatory tariffs could potentially affect local economies here.
Already, he said, there’s a strong sentiment to avoid U.S. products among Canadian consumers.
“I think people are really just shocked and upset,” he said, “to think that our biggest ally and trading partner would, for reasons that don’t make a lot of sense, come out and be harder on us than on countries like China and Russia.”
Andrew Duffy is a National Newspaper Award-winning reporter and long-form feature writer based in Ottawa. To support his work, including exclusive content for subscribers only, sign up here: ottawacitizen.com/subscribe
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