Facing US tariffs, Canadians hunt for business in Europe

Canadian companies were hoping to seize business opportunities in Europe at the Hanover Fair – Copyright AFP SAUL LOEB

Clement KASSER

With his small steel mill facing hefty US tariffs, Canadian businessman Chris Wyatt is hunting for new European customers at the world’s biggest industrial technology fair in Germany.

“There’s uncertainty in the markets so big projects are being shelved or they’re just not moving ahead,” said sales director Wyatt, handing out flyers at his stand, alongside big players in robotics and factory machinery.

This week’s Hanover Fair, which has attracted more than 4,000 exhibitors from around 60 countries, takes place as US President Donald Trump gears up to announce a wave of “reciprocal tariffs”, ratcheting up global trade tensions even further.

And this year’s guest of honour is Canada — a clear signal that Europe stands with Ottawa as it faces not just hefty duties from the United States, its largest trading partner, but also Trump’s threats to annex the country.

“Welcome to Germany, dear Canadian friends,” German Chancellor Olaf Scholz said Sunday ahead of the fair’s opening. “We stand by your side.” 

His comments highlighted warming ties between Europe and Canada amid Trump’s sabre-rattling — with some even joking that Canada should join the EU.

For Wyatt the impacts of Trump’s trade war are already being felt. 

The president slapped 25-percent tariffs on US steel and aluminium imports on March 12, and even briefly threatened to hike the duty to 50 percent on Canadian imports.

Wyatt’s Ontario company Kubes Steel currently exports 80 percent of its production, specialised steel for a range of industries including the nuclear sector, to the United States.

“Of course, we are concerned,” said Wyatt, whose company employs about 80 people. “People aren’t spending money at this point.”

Still he is hopeful the trade fair will bring new opportunities — he managed to make contacts with prospective new clients, including Spanish transport companies.

– Tariff ‘own goal’ –

In his opening address, Scholz called for stronger ties between the European Union and Canada as the two sides “complement each other” when it comes to making machinery, artificial intelligence, renewable energy and electric vehicles.

Closer ties with G7 economy Canada also stand to benefit Europe and in particular Germany, which will be hit hard by new 25-percent US duties on imports from the auto sector, one of the country’s flagship industries.

The auto duties are bad news for Milko Konzelmann, whose German family-run business producing plastic car parts and valves makes around a quarter of its sales in the world’s biggest economy.

“I will lose money,” he said, adding that he was waiting to see how long Trump would keep pushing tariffs, which he described as an “own goal”.

But if there is no change, the company will focus more on Asia.

Shifting production to the United States to avoid tariffs would “take years” and is a “big decision for a medium-sized company” with just 300 employees, he said. 

Despite the hostility towards Trump in Europe, American companies, including Dell, IBM, Microsoft and Nvidia, were out in force in Hanover, with some not shy about speaking in favour of the president’s drive to rebalance US trade with the EU.

Manufacturing powerhouse Germany stands out when it comes to US complaints on trade — Europe’s biggest economy logged a record trade surplus with the United States last year and huge numbers of its goods, from cars to pharmaceuticals, are shipped to America.

“We have to be able to compete and we can’t sit there, playing a game where they (Europe and Asia) sell to us but we can’t sell to them,” Ryan Mosher, from small US company Conrad that makes air compressor parts, told AFP. 

Still, he concedes trade tensions will hit his business: “I’m going to lose some money, that’s for sure.”

Texas businesswoman Suzanne Stewart also said the tariffs would impact her company, which makes metal mesh, as it needs to keep importing some materials from Asia.

“In reality not everything is available in the US,” she said.