Packaging Brockville’s manufacturing strengths during economic challenges
Economic challenges lie on Brockville’s near horizon, and as a region once known for a manufacturing sector that struggled to adapt, local industrialist David Beatty has a few suggestions for the future.
The encouraging news is that the immediate challenges are bringing Canadians together, creating possibilities for a more prosperous and competitive nation.
The manufacturing sector will play a key role in ensuring this region’s future strength and prosperity, but the threat of tariffs from U.S. President Donald Trump poses one of the most significant challenges to that sector in recent history.
“I think one of the first things we have to do is diversify,” Beatty, owner and chairman of Brockville-based Canarm Ltd., said in a recent interview.
The United States will always be Canada’s top trade partner, added Beatty, but with the threat of President Donald Trump’s tariffs hanging over it, the country needs to lessen that dependency considerably.
“More and more people are thinking that Canada has to be more self-reliant and diversified,” he added.
Beatty, whose career also includes a great deal of economic development work, is past chairman of the St. Lawrence Corridor Economic Development Commission, a group entrusted with attracting more employers to southern Leeds and Grenville.
Canarm, which manufactures lighting, ventilation and agricultural equipment, does a lot of business in the United States, and could serve as an example of a Canadian manufacturer getting ahead of the tariff threat. A few months ago, it bought Peerless Blowers in North Carolina, allowing it to manufacture HVAC equipment there.
“We’ve got more capacity today to manufacture in the United States,” said Beatty.
“It’s something that we could do, and thank goodness we did it three or four months ago.”
Since then, the growing disparity between the U.S. and Canadian dollar has made it harder for Canadians to make such acquisitions, Beatty noted.
That makes it all the more important for Canadian businesses to find new customers.
Diversifying trade partners is the first task in a four-point plan the corridor economic development commission has put forward to respond to Trump’s tariff threat.
“That’s already started,” said Charlie Mignault, the organization’s commissioner.
Locals have made early overtures to the Bahamas and Peru, said Mignault. He notes 75 to 80 per cent of locally-made products go to the U.S., a dependency that needs to be addressed.
While Canada must diversify its trade at the national level, Brockville-area manufacturers can also take action, Beatty added, suggesting local companies “work as a consortium and think strategically.”
Beatty cites the example of the Caribbean, where tourism is a big industry. Tourism accommodations there could purchase HVAC equipment from Canarm, water systems from Brockville-based Newterra, and wiring from another Brockville company, Northern Cables, for instance.
“Is there a way that we can take all of the manufacturing that is done in the area in a package and market it as a group?”
Area companies can take a similar approach to the mining industry in South America, Beatty suggested.
“There must be something that we could put together that helps all the industry that feeds the mining,” he said.
Four or five small manufacturers coming together with such package deals end up spending less on the effort than a single one attempting to enter a new market alone, Beatty added.
The second point in the corridor group’s plan, added Mignault, is strengthening local supply chains, with an eye to efficiencies in logistics.
“It’s working together to ensure that we’re being as cost-effective and competitive as we can be,” said Mignault.
On the domestic front, Beatty joins the chorus of Canadian voices calling for the reduction of interprovincial trade barriers, and that is also the third point in the regional four-point plan.
“If it’s ever going to happen, it’s got to happen over the next few years,” said Beatty.
Mignault agrees with the Brockville industrialist and former commission chairman that the cross-border crisis is an opportunity for unprecedented movement on the longstanding issue of interprovincial barriers.
“These trade barriers effectively act as a 21-per-cent tariff,” said Mignault, adding economists suggest eliminating them could bump up Canada’s GDP by two per cent, counteracting much of the GDP damage inflicted by the U.S. tariffs.
The fourth and final point in the plan, said Mignault, is pressing Ottawa to ensure there are reciprocal tariffs in response to those levied by Washington.
As Beatty sees it, the good news is that Canada is ready for a robust response to the looming threat, as the current U.S. president’s musings about Canada becoming the 51st state have brought Canadians together in a spirit of resiliency.
“Trump has done more in 30 days to unite Canada than the last 50 years of bickering,” said Beatty.
And that spirit could drive this community to pull together for future prosperity.
Locally, outside the immediate cross-border crisis, Beatty sees housing costs remaining a critical challenge for the area in the near future.
“Not being able to have young people afford a house has got to be one of the biggest problems that Canada faces,” said Beatty.
One immediate solution, he suggested, is drastically reducing that portion of a house’s cost that stems from regulations.
“We are way over-regulated,” said Beatty.
Here he takes issue with the number of local governments responsible for the population of Leeds and Grenville. Those currently number 14, including the 10 lower-tier-municipalities that form the United Counties of Leeds and Grenville, the upper-tier counties government itself, and the three separated municipalities of Brockville, Prescott and Gananoque.
Nonetheless, much of the region’s near-term resiliency and economic prosperity are likely to depend on effectiveness in responding to the American tariff threat. Amid what could be a full-scale trade war, Mignault reminds area residents that another key to regional prosperity is its hospitality industry.
As the name indicates, a spirit of hospitality must be preserved, despite the temptation for passions to heat up during the tariff fight.
“We want them (Americans) to know that we want them to keep coming,” said Mignault.
And that means remembering that the folks across the river remain our friends and neighbours, despite the rhetoric from Washington.
“The last thing we want to do is boo the American national anthem,” said Mignault.
