N.B. Liquor Won't Buy U.S. Alcohol, Even with Tariff Delay

Premier Susan Holt says New Brunswick will hold off on purchasing new American booze as a response to U.S. tariffs, despite the 30-day delay / CBC

New Brunswick Premier Susan Holt had initially planned to remove U.S. alcohol from N.B. Liquor stores as part of the province's response to the tariff threat issued by U.S. President Donald Trump. However, with the announcement that tariffs would be delayed for 30 days, Premier Holt made adjustments to her plan. While current stock of American alcohol will remain on store shelves, New Brunswick's liquor outlets will not be ordering any new products from the U.S. during this period of uncertainty.

The looming 25 percent tariff on most Canadian products crossing into the United States had been set to go into effect at midnight Tuesday, creating concerns about its impact on both the province’s economy and local businesses. With the tariff delay now in place, Premier Holt expressed relief but emphasized that the threat remains very much alive. As the situation develops, Holt stated that she is carefully monitoring the situation to ensure New Brunswick is prepared for any potential shifts in U.S. trade policy.

Impact of Tariffs on New Brunswick's Economy and Local Business Operations

One of the major concerns highlighted by Premier Holt is that some New Brunswick companies may begin to shift their production operations to the U.S. temporarily to avoid the tariffs. This shift could potentially harm the province’s economy, leading to job losses and reduced production capacity. Holt noted that some businesses had already expressed an interest in moving operations across the border, including J.D. Irving Ltd., one of the largest employers in New Brunswick. However, a spokesperson for Irving downplayed the idea of relocating operations, describing it as hypothetical.

Premier Holt was also concerned about the long-term impact of these tariffs, particularly if they were to become permanent. She emphasized that the government is working on strategies to help companies mitigate the additional costs brought on by the tariffs, although she made it clear that New Brunswick would not be able to fully subsidize these costs to prevent production shifts to the U.S.

At least one major industry, Moosehead Breweries, is particularly worried about the impact of the tariffs on its U.S. exports. As the largest brewery in New Brunswick, Moosehead sends around 20 percent of its output to the U.S., and any disruption to that flow due to tariffs or retaliatory measures could be financially damaging.

Government Response and Avoidance of New U.S. Contracts

In addition to the decision on alcohol purchases, Premier Holt confirmed that the provincial government would avoid signing new contracts with U.S. firms, unless absolutely necessary. This response includes halting procurement for non-critical services, which may help protect New Brunswick's economic stability in the face of these potential trade disruptions. While no specific dollar value for the delayed contracts was provided, Holt emphasized that critical services essential for the province's functioning would not be impacted by this move.

The government has stated that existing contracts with U.S. companies will remain in place, due to the significant costs of cancellation and the disruption it would cause to both public services and private industry in New Brunswick.

The Broader Economic Impact of U.S. Tariffs on Canada

The impact of these tariffs extends beyond alcohol and government contracts. Economist Herb Emery from the University of New Brunswick warned that the tariffs could lead to higher costs for consumers as the Canadian dollar depreciates in response to the trade conflict. With U.S. goods becoming more expensive for Canadian consumers, the tariffs could drive up the overall cost of living, particularly for goods and services that rely on cross-border trade.

The Atlantic region, which is heavily dependent on energy imports, is particularly vulnerable. The Atlantica Centre for Energy reports that New England buys billions of dollars worth of fuel, natural gas, and electricity from Canada each year, all of which are now subject to new tariffs. The region also depends on Canadian products for its transportation and aviation sectors, which could see increased costs passed down to consumers in the form of higher prices at the pump or for air travel.

Public Sentiment and Calls for Supporting Local Economy

In response to these trade tensions, Premier Holt urged New Brunswick residents to consider supporting local businesses and tourism within the province, rather than traveling to the U.S. if the tariffs were to go into effect. She believes that local economic activity could be bolstered as a result of this sentiment. A recent poll by Narrative Research found that a significant number of people in the Maritimes planned to reduce their travel to the U.S. because of President Trump’s policies, and Holt sees this as an opportunity for Canadians to show unity and support for their own economy.

Despite the delay in tariffs, the premier’s message remains clear: New Brunswickers must be prepared for the ongoing threat of trade war, and any potential tariff escalation could have lasting repercussions for local businesses, consumers, and workers. As the situation evolves, Holt remains committed to protecting the province’s economic interests and is continuing to monitor the trade dispute closely.

As the province adjusts its strategies, it’s evident that the impact of tariffs on U.S. alcohol imports and other sectors will continue to unfold, and the response from local businesses and government officials will shape the future of New Brunswick’s economy.