“US Tariffs Hit Ontario Hard – Budget Deficit More Than Doubles”
(Source: Reuters) – May 15, TORONTO
Ontario, Canada’s biggest province and manufacturing hub, just dropped a financial bombshell—its budget deficit is exploding due to US trade wars.
What’s Happening?
- Ontario’s deficit is more than doubling this year—from $6 billion to $14.6 billion—the worst since the pandemic.
- The US tariffs on cars, steel, and aluminum (Ontario’s biggest exports) are crushing the economy.
- Growth is slowing down (just 0.8% this year vs. 1.5% last year).
- The province won’t balance its books until 2027-28, a year later than expected.
Why Does This Matter?
Ontario sells over 75% of its exports to the US, so these tariffs are a major blow. Premier Doug Ford called an early election this year, saying he needed a stronger mandate to fight US trade policies. Now, the financial fallout is here.
Ontario’s Fightback Plan
To help businesses survive, the government is:
✅ $5 billion emergency fund for companies hurt by tariffs
✅ $1.3 billion tax break for manufacturers
✅ $500 million to boost mining & critical minerals
✅ $5 billion extra for infrastructure (housing, energy, transit)
The Bigger Problem
Ontario isn’t alone—Quebec, BC, and Alberta are also seeing budget troubles. But Ontario’s debt is rising fast, hitting 38% of GDP soon.
The Silver Lining?
Borrowing costs are dropping next year, which could ease some pain. But with US trade tensions still high, Ontario’s economy isn’t out of the woods yet.
Final Thought:
This is a warning sign—if US tariffs keep hurting trade, Ontario (and Canada) could face even bigger money problems.
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