Business owners reeling from tariff ‘chaos’

And just like that, California wine will rejoin the menu at 529 Wellington.

The restaurant’s parent company, Wow Hospitality, removed roughly $500,000 worth of American liquor from its six restaurants earlier this week. The protest was in response to U.S. President Donald Trump slapping 25 per cent tariffs on most Canadian goods on Tuesday. Premier Wab Kinew ordered Manitoba Liquor and Lotteries to pull U.S. booze from store shelves in response.

On Thursday afternoon, the Trump administration said it would pause the levies against some Canadian goods until April 2.

“Chaos, uncertainty. (It’s) very frustrating,” Doug Stephen, president of Wow Hospitality, said about the tariff back-and-forth.

Following America’s policy reversal, Stephen’s staff began restocking U.S. wines in Wow’s restaurants. The bottles could be pulled again in April.

“I’m just hoping that cooler heads prevail and that the U.S. understands that Canada is a friend, not a foe,” Stephen said.

Tyler Slobogian, a senior policy analyst with the Canadian Federation of Independent Business, called the pause a “sigh of relief” for many.

Still, roughly 62 per cent of Canadian exports to the U.S. will likely be subject to tariffs because they don’t comply with the Canada U.S. Mexico Agreement, The Canadian Press reported.

“It’s all very confusing,” Slobogian stated. “But I think it’s definitely a step in the right direction.”

Slobogian credited Canadian governments for fighting back by unveiling retaliatory tariffs Tuesday, in which $30 billion worth of U.S. goods would be subject to 25 per cent tariffs.

Meanwhile, provincial governments have taken their own actions, including pulling American liquor from store shelves.

Ottawa said Wednesday most provinces had struck a deal to ease the trade of alcohol across provincial borders.

“This is unprecedented action to reduce trade barriers in Canada,” Internal Trade Minister Anita Anand told CBC News.

Regardless of tariffs, work to break down interprovincial barriers must continue, Slobogian urged, while calling the current progress “encouraging.”

Manitoba entrepreneurs are waiting to put their company’s products in liquor stores in other provinces.

An interprovincial deal targeting direct-to-consumer sales won’t do much for Little Brown Jug Brewing Co., said founder Kevin Selch.

“If you live in Toronto … and you want to order our beer, we can ship it to you, but that’s expensive and inefficient,” he stated. “We need access to shelves.”

He and his peers want access to Ontario liquor stores. The Liquor Control Board of Ontario is one of the world’s largest alcohol purchasers; Canadian products made outside of Ontario compete with items globally, Selch explained.

“It’s right next door,” he said. “We would be in there tomorrow. We can fill those orders.”

Brock Coutts, owner of Patent 5 Distillery, has also eyed Ontario customers. Patent 5 is shipping 80 cases of gin to Saskatchewan, a first dip of its toes into the Prairie province.

Both Coutts and Selch said Manitoba craft liquor producers would be more competitive — within the province and outside — if local regulations were changed.

For example, lowering the mark-up on beer sold in Manitoba Liquor and Lotteries stores would help offset increased costs caused by tariffs (if the levies reappear), Selch explained. The mark-ups are higher than those of other provinces, he said.

“We cannot sell direct to a bar or restaurant,” Coutts noted.

The province continues to work with Manitoba brewers and distillers, said Glen Simard, the minister responsible for Manitoba Liquor and Lotteries.

Patent 5 had almost begun selling alcohol in the States when the threat of tariffs arrived. Even with the current pause, the Exchange District distillery won’t invest an “extraordinary amount of time” into the project until the economy becomes more certain, Coutts said.

“You can still get your good local stuff, and that won’t be affected (much) by tariffs,” said Willows Christopher, co-founder of Shrugging Doctor Beverage Co.

He has been preparing for the cost of Shrugging Doctor’s aluminum cans and glass bottles to increase, should tariffs materialize.

Trump is constantly gauging the public’s reaction to his policies, leading to a roller-coaster of changes, the Canada West Foundation’s chief executive officer explained.

“The market reaction has been not very good,” Gary Mar said. “All of the gains that took place when he became president of the United States have now been erased in the markets.”

Trump measures his performance by the stock exchange, Mar added. Mar expects tariff concerns will continue over the next year. If there’s pushback on tariffs by Americans feeling pinched, the levies will disappear, Mar predicted.

“By reason of geography, the United States will always … be our biggest trading partner,” he said. “That doesn’t mean we shouldn’t be looking to other marketplaces.”

Mar applauded the Manitoba government for taking “measured” steps in response to the economic hit.

Trump said he still plans to install reciprocal tariffs beginning April 2.

» Winnipeg Free Press, with files

from the Canadian Press