Canadian Economic News, April 2025 Edition

Tariffs

• The White House announced on April 2nd that President Trump would impose a 10% tariff on all countries, effective April 5th, and that he would impose an individualized reciprocal higher tariff on the countries with which the United States has the largest trade deficits, effective April 9th. The White House also said on April 2nd that some goods will not be subject to the Reciprocal Tariff, including:
  • steel/aluminum articles and autos/auto parts already subject to earlier tariffs;
  • copper, pharmaceuticals, semiconductors, and lumber articles;
  • all articles that may become subject to future tariffs;
  • bullion; and
  • energy and other certain minerals that are not available in the United States.
• The White House said that for Canada and Mexico, the existing fentanyl/migration orders remain in effect, are unaffected by this order, and that this means:
  • United States-Mexico-Canada (USMCA) compliant goods would continue to see a 0% tariff,
  • non-USMCA compliant goods would see a 25% tariff, and
  • non-USMCA compliant energy and potash would see a 10% tariff.
  The White House said that in the event the existing fentanyl/migration orders were terminated, USMCA compliant goods would continue to receive preferential treatment, while non-USMCA compliant goods would be subject to a 12% reciprocal tariff.
• In a separate release on April 2nd, the White House announced that President Trump had signed an Executive Order eliminating duty-free de minimis treatment for low-valued (valued at or under USD $800) imports from China and Hong Kong.
• On April 29th, the White House announced that President Donald J. Trump had signed a proclamation to incentivize domestic automobile production and reduce American reliance on imports of foreign automobiles and their parts by offsetting a portion of tariffs for automobile parts used in U.S.-assembled vehicles. The President also said he was amending the tariffs to avoid the cumulative effect of overlapping tariffs (non-stacking of tariff measures) on certain articles.

• The Government of Canada confirmed that its new countermeasures to the tariffs imposed by the United States on the Canadian auto industry would come into force on April 9th, including 25% tariffs on non- Canada-U.S.-Mexico Agreement (CUSMA) compliant fully assembled vehicles imported into Canada from the United States; and 25% tariffs on non-Canadian and non-Mexican content of CUSMA compliant fully assembled vehicles imported into Canada from the United States.
• The Government of Canada announced on April 15th new measures for Canadian businesses and entities affected by the tariff dispute between Canada and the U.S., including (i) the remission of some of the countermeasure tariffs announced by Canada that would allow automakers that continue to manufacture vehicles in Canada to import a certain number of U.S.-assembled, CUSMA-compliant vehicles into Canada, free of the countermeasure tariffs that Canada has imposed; and (ii) temporary 6-month relief for goods imported from the U.S. that are used in Canadian manufacturing, processing and food and beverage packaging, and for those used to support public health, health care, public safety, and national security objectives. The Government also said that the new Large Enterprise Tariff Loan Facility (LETL), announced in March, was now accepting applicants and that this program will support eligible large businesses that are facing difficulties in accessing traditional sources of market financing, by providing access to liquidity.
• The Government of British Columbia announced on April 10th that it had updated its direction to ministries, health authorities, and core Crown corporations to review all contracts with United States companies to decrease the Province's dependence on goods and services from U.S. suppliers.
• The Government of Ontario announced on April 7th that it was providing approximately $11 billion in relief and support for workers and businesses as it protects the province's economy from economic uncertainty and the impact of U.S. tariffs. The Government said that as a first step it was (i) deferring select provincially administered taxes for six months from April 1, 2025, to October 1, 2025, giving businesses and job creators approximately $9 billion worth of cash flow; and (ii) through the Workplace Safety and Insurance Board (WSIB), issuing a further $2 billion rebate for safe employers to support businesses and help keep workers on the job, in addition to the previous $2 billion rebate distributed in March.
• The Government of Yukon announced on April 4th that in response to the latest round of tariffs, it would (i) end rebates for all Tesla products offered through the Good Energy program; (ii) begin reviewing Yukon government Starlink accounts and cancel accounts that are not required for business continuity or emergency response; and (iii) shift Yukon government digital communications away from X, formerly known as Twitter.

Canada's internal trade

• The Government of New Brunswick announced it had introduced legislative amendments to the Fair Registration Practices in Regulated Professions Act that, if passed, would allow workers in regulated professions to begin working immediately in their new jurisdiction during the registration process. As well, the Government said that amendments to the Liquor Control Act would enable New Brunswickers to participate in the direct-to-consumer sales of alcohol and would eliminate personal exemption limits for alcohol.
• The Governments of Newfoundland and Labrador and New Brunswick announced they had signed a memorandum of understanding on free trade and labour mobility.
• The Government of Nova Scotia announced that its Free Trade and Labour Mobility within Canada Act would address (i) goods manufactured, produced, or approved for use in a reciprocating province or territory, which would be treated the same as those produced in Nova Scotia; and (ii) service providers and licensees properly certified or licensed in a reciprocating province who would be recognized as if they are licensed in Nova Scotia. The Government said Prince Edward Island and Ontario had joined the Province by introducing reciprocal legislation that would help foster an environment of mutual recognition of goods, services, and labour mobility between these provinces.
• The Government of Ontario announced it was introducing the Protect Ontario through Free Trade within Canada Act that would support free trade and mobility across Canada. The Government said that as part of this effort, it was signing memorandums of understanding (MOUs) with Nova Scotia and New Brunswick that will bolster interprovincial trade.

Resources

• Calgary-based South Bow Corp. announced it had shut down the Keystone Pipeline following an oil release in North Dakota on April 8th. On April 16th, South Bow said it had restarted the Keystone Pipeline System.
• Toronto-based Barrick Gold Corporation announced it had reached an agreement to sell the 50% interest in the Donlin Gold Project in Alaska held by Barrick's subsidiary, Barrick Gold U.S. Inc., to affiliates of Paulson Advisers LLC and NOVAGOLD Resources Inc. of Florida for USD $1 billion in cash. Barrick said the transaction is expected to be completed late in the second quarter or early in the third quarter of 2025, subject to the satisfaction of customary closing conditions and obtaining the required regulatory approvals.
• Vancouver-based Lumina Gold Corp. and CMOC Singapore Pte. Ltd., a Singapore entity and subsidiary of CMOC Group Limited of China, announced they had entered into an arrangement agreement pursuant to which CMOC will acquire all of the issued and outstanding common shares of Lumina for a total equity value of approximately $581 million. The parties said they anticipate completion of the transaction in the third quarter of 2025, subject to shareholder and British Columbia Supreme Court approvals, acceptance by the TSXV, and other standard conditions of closing for a transaction of this nature.

Provincial budgets

• On April 9th, the Government of Newfoundland and Labrador released Budget 2025, which included investments in health care, education, justice infrastructure, housing, supporting industry and businesses, and improving affordability. The Government projects a $372 million deficit in 2025-26 and real gross domestic product (GDP) growth of 4.4% in 2025.
• On April 10th, the Government of Prince Edward Island presented its 2025-26 operating budget, which included income tax cuts as well as investments in health care, infrastructure, and education. The Government forecasts a $151.9 million deficit for 2025-26, which rises to $189 million when the Tariff and Trade Contingency Fund is included, and real GDP growth of 2.5% in 2025.

Minimum wage

• The federal minimum wage increased from $17.30 to $17.75 per hour on April 1st.
• Newfoundland and Labrador's minimum wage increased from $15.60 to $16.00 per hour on April 1st.
• Nova Scotia's minimum wage increased from $15.20 to $15.70 per hour on April 1st.
• New Brunswick's minimum wage increased from $15.30 to $15.65 per hour on April 1st.
• Yukon's minimum wage increased from $17.59 to $17.94 per hour on April 1st.

Carbon tax

• The Government of Alberta announced that the federal government had scrapped its consumer carbon tax, and that with its removal, Alberta drivers would save an average of $215 per year at the pumps.
• The Government of British Columbia announced it was cancelling the carbon tax, effective April 1st, to align B.C.'s carbon tax rate with the new federal carbon tax rate. The Government said that the climate action tax credit, developed to help offset the impacts of the consumer carbon tax on people and families, would also be cancelled.
• The Government of the Northwest Territories announced it would remove the Northwest Territories carbon tax for all consumers except large emitters on April 1st to align with changes in the Government of Canada's carbon pricing policy to eliminate the federal consumer carbon tax.
• The Government of Nunavut announced that effective April 1st, the prices for some fuels would be decreasing across Nunavut because of the suspension of the Federal Carbon Tax.
• The Government of Saskatchewan announced that effective April 1st it would pause the industrial carbon tax rate under its Output-Based Performance Standards (OBPS) Program and that the carbon tax rate rider would be removed from all SaskPower bills.

Other news

• The Bank of Canada held its target for the overnight rate at 2.75%. The last change in the target for the overnight rate was a 25 basis points cut in March 2025.
• The Government of Nova Scotia announced it had cut its portion of the harmonized sales tax (HST) by 1%, lowering the overall tax rate to 14% effective April 1st. The Government also said it had increased the basic personal amount that Nova Scotians can claim before paying taxes from $8,744 to $11,744, and implemented indexing of tax brackets and several non-refundable tax credits to help reduce the impact of inflation.
• Toronto-based Brookfield Infrastructure Partners L.P. and its institutional partners announced they had reached a definitive agreement to acquire 100% of the midstream asset portfolio Colonial Enterprises Inc. of California, which includes the Colonial Pipeline, for an enterprise value of approximately USD $9 billion. Brookfield said the transaction is expected to close in the second half of 2025, subject to customary closing conditions.
• Toronto-based Rogers Communications Inc. announced it had entered into a definitive agreement with funds managed by Blackstone of New York, backed by Canada Pension Plan Investment Board, Caisse de dépôt et placement du Québec, the Public Sector Pension Investment Board and British Columbia Investment Management Corporation, for a $7 billion equity investment. Rogers said Blackstone would acquire a non-controlling interest in a new Canadian subsidiary of Rogers that will own a minor part of Rogers wireless network. Rogers also said the transaction is expected to close in the second quarter of 2025, subject to satisfaction or waiver of all closing conditions.
• In a separate release, Rogers and the National Hockey League (NHL) announced a 12-year, $11 billion agreement for the national media rights to NHL games on all platforms in Canada through the 2037-38 season.
• Unifor announced that it had been informed by General Motors that the CAMI Assembly Plant in Ingersoll Ontario would initiate temporary layoffs starting April 14th with workers returning in May for limited production. Unifor said that after that, production would temporarily cease with operations idling until October, in which time the plant would operate on a single shift for the foreseeable future, resulting in the indefinite layoff of nearly 500 workers.
• Atlanta, Georgia-based United Parcel Service of America, Inc. (UPS) announced it had entered into a definitive agreement to acquire Andlauer Healthcare Group Inc. (AHG) of Toronto, a supply chain management company, for a total purchase price of approximately $2.2 billion. UPS said that closing of the transaction is targeted for the second half of 2025, subject to AHG's shareholder approval, customary regulatory reviews and approvals, and other customary closing conditions.
• Michigan-based Dow Inc. announced it had decided to delay construction of its Path2Zero project in Fort Saskatchewan, Alberta, until market conditions improve. The Company said it now expects its total enterprise 2025 capital expenditures to be USD $2.5 billion compared to its original plan of USD $3.5 billion.

United States and other international news

• The Reserve Bank of Australia (RBA) left the cash rate target unchanged at 4.10%. The last change in the cash rate target was a 25 basis points cut in February 2025.
• The Reserve Bank of New Zealand (RBNZ) lowered the Official Cash Rate (OCR), its main policy rate, by 25 basis points to 3.50%. The last change in the OCR was a 50 basis points cut in February 2025.
• The European Central Bank (ECB) lowered its three key interest rates by 25 basis points to 2.25% (deposit facility), 2.40% (main refinancing operations), and 2.65% (marginal lending facility). The last change in these rates was a 25 basis points reduction in March 2025.
• The eight OPEC+ countries - Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman - which previously announced additional voluntary adjustments in April and November 2023, announced they would implement a production adjustment of 411 thousand barrels per day, equivalent to three monthly increments, in May 2025.
• California-based NVIDIA announced it was working with its manufacturing partners to design and build factories that will produce NVIDIA AI supercomputers entirely in the U.S., and that within the next four years it plans to produce up to half a trillion dollars of AI infrastructure in the U.S. NVIDIA said Blackwell chips had started production at chip plants in Arizona, that NVIDIA was building supercomputer manufacturing plants in Texas, and that mass production at both plants is expected to ramp up in the next 12-15 months.
• Virginia-based Boeing announced it had entered into a definitive agreement to sell portions of its Digital Aviation Solutions business to Thoma Bravo of Illinois in an all-cash transaction valued at USD $10.55 billion. Boeing said the transaction is expected to close by the end of 2025, subject to regulatory approval and customary closing conditions.
• United Parcel Service of America, Inc. (UPS) announced it expects to reduce its operational workforce by approximately 20,000 positions during 2025 and close 73 leased and owned buildings by the end of June 2025 to enhance the efficiency of its network through automation and operational sort consolidation in its U.S. Domestic network.

Financial market news

• West Texas Intermediate crude oil closed at USD $58.21 per barrel on April 30th, down from a closing value of USD $71.48 at the end of March. Western Canadian Select crude oil traded in the USD $45 to $52 per barrel range throughout April. The Canadian dollar closed at 72.40 cents U.S. on April 30th, up from 69.56 cents U.S. at the end of March. The S&P/TSX composite index closed at 24,841.68 on April 30th, down from 24,917.50 at the end of March.