Will Canadian businesses feel the impact of the Trump Presidency?

It is less than one month into his presidency and President Donald Trump has made a significant number of changes, and those changes are being felt globally. According to experts, those changes may have an impact in Canada, but it may be too soon to tell.

Mathew Wilson, senior vice-president of the Canadian Manufacturers and Exporters said in an interview that companies may choose to operate out the US instead of Canada because of the US president’s stance on US companies making foreign investments.

“I can’t see any major corporation wanting to be the subject of a Twitter feed,” Wilson said.

Manufacturing though, is not the only sector that is being impacted by political rumblings south of the border. Royce Mendes, a senior economist at the Canadian Imperial Bank of Commerce, said in an interview with the Globe and Mail that, in the long term, the Canadian housing market could be at risk. Changes in the US could affect interest rates, cooling off the rise in housing prices in some markets that may have already cooled. Mendes says he has faith in the Bank of Canada getting any adjustments they might make right, and that the debt load of individual Canadians is not as bad as what it was when the US housing market took a turn for the worse in 2008.

When it comes to the stock market, Trump’s executive order for a 90-day travel ban for travelers from seven Middle Eastern and African countries —including US green card holders— may be taking a turn. Prior to the order, Bryan Borzykowski, writing for CNBC, said the Canadian market was doing well. Shortly after the announcement, things started going south again. However, that might be due to uncertainty, said Bob Sewell, CEO of Oakville’s Bellwether Investment Management to CNBC.

“His first days in power have led people to be more uncertain,” said Sewell. “Until there’s clarity around these positive growth–type aspects of his platform, we’ll continue to see concern in the market.”

Of course, the biggest impact on Canadian markets could come in the form of a renegotiation of the North American Free Trade Agreement. While Trump has seemed to be targeting US investment in Mexico, it is not yet certain if his ‘America first’ policies will exclude Canada. The proposed border tax could impact Canadian profits and the desire of American companies to invest north of the border. According to the Office of the US Trade Representative, trade between the US and Canada was US $660 billion in 2015, with more than US $325 billion in Canadian imports.


Pin It

Leave a Reply

Your email address will not be published. Required fields are marked *

* Copy This Password *

* Type Or Paste Password Here *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>