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July 27, 2018
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New grocery tariff may impact border communities’ relations
by
Lura Jackson

 

     The post‑colonial community of the St. Croix Valley has always been an international one; it is a relationship long embodied by Calais and St. Stephen in particular. The twin communities grew up together, residents were born on either side depending on the availability of medical facilities, and modern‑day consumers have benefitted from comparison shopping over the border. In recent decades, cross-border shopping has been steadily decreasing, and now, in the wake of a retaliatory "grocery tariff" established by the Canadian government, residents are concerned that the international nature of the St. Croix Valley is becoming a remnant of the past.
     The new Canadian‑imposed tariff went into effect on July 1 in response to the United States establishing a 25% tariff on steel and a 10% tariff on aluminum beginning in March. The estimated cost to Canada of the steel and aluminum tariffs is approximately $12.8 billion. In retaliation, Prime Minister Justin Trudeau's administration established the so‑called "grocery tariff," valued at $16.6 billion Canadian.
     While the steel and aluminum tariffs largely impact industrial buyers, the grocery tariff affects consumer products that would be commonly transported over the border between Calais and St. Stephen. The list includes yogurt, coffee, ketchup, pizza, maple syrup, cucumbers, orange juice, soy sauce, mayonnaise, soups and broths, and mixed condiments and mixed seasonings, among many others. Food items are not the only type of good affected, as the list also includes toilet paper, candles, plastic household articles, greeting cards and postcards, pillows, ball-point pens and many more products.
     Most items on the list are subject to a 10% tariff if the individual bringing them over has more than $20 of applicable goods, although that changes if the shopper is in the United States for more than 24 hours.
     The wide breadth of items affected has led to some St. Stephen residents choosing to do all of their shopping in Canada rather than to go through a lengthy and potentially expensive crossing process. St. Stephen resident and journalist Rob Patry describes the new tariffs as "beyond devastating" and says that many residents are now looking to make any necessary purchases without crossing the border. "Word around town is that people are not wanting to go to the states to purchase much of anything," Patry says. "Because the list is so long and complex, I think a lot of people will just as soon not even bother going there. I don't understand why any of this has happened or what will be gained from it."
     St. Stephen Mayor Allan MacEachern points out that the grocery tariff is at the top of a list of concerning issues. "The tariffs have definitely been a hot topic of discussion for sure," MacEachern says. "Along with the exchange rate, it may be discouraging some people from cross‑border shopping." The exchange rate has been steadily decreasing for Canadian shoppers this year, with their dollar currently worth about 76 cents. 
     Some see how the tariffs negatively impact both Calais and St. Stephen. Pastor Johnny Chambers, a dual citizen who divides his time between the two countries, says the new tariffs "are really going to hurt border communities." Chambers says that Canadians who previously shopped in Calais will be shopping in Saint John instead, which will in turn impact St. Stephen. "Dollar‑for‑dollar, money spent in Calais would wind back up in the St. Stephen community," Chambers says.
     Business owners are remaining cautious about the changes. Carla McLellan, manager at Tradewinds Shop 'n Save in Calais, says that it's "too early to tell" at this stage in terms of how much, if any, the tariff will affect business beyond what the exchange rate has already done.
     With the consensus being that the tariffs are not a positive change for the St. Croix Valley, residents who were formerly divided by no more than a river have now found far‑distant central governments between them. The impact of such divisions will undoubtedly shape the ongoing evolution of a valley that has always held its international nature to be part of its identity.

 

 

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