THUNDER BAY — The United States and China have struck a temporary 90-day agreement to reduce tariffs, offering a much-needed pause in an escalating trade war that has shaken global markets and threatened to tip economies into recession.
Following high-level talks in Geneva, U.S. Treasury Secretary Scott Bessent announced that both nations would lower tariffs by over 100 percentage points, bringing them to a baseline of 10 percent as negotiations continue. The move was framed as an effort to prevent further economic decoupling and to restore balance in global trade flows.
“This agreement is a critical step back from the brink,” Bessent stated, noting that the talks signaled a renewed willingness to cooperate despite persistent tensions.
Implications for Thunder Bay Businesses
Local industries in Thunder Bay and Northwestern Ontario—especially those tied to forestry, mining, and manufacturing—may experience indirect benefits from the truce. The easing of tariffs could stabilize commodity prices, lessen supply chain disruptions, and improve export conditions, particularly for businesses reliant on U.S. and Asia-Pacific markets.
Thunder Bay Chamber of Commerce President Charla Robinson has previously expressed concern over the trade war’s ripple effects on local enterprises. Reduced tariffs could provide breathing space for small businesses importing machinery, electronics, and parts that had become more costly under the escalating tariffs.
Commodity Prices and Supply Chain Watch
The trade dispute had contributed to volatility in key commodities like pulp, lumber, and metals—staples of Northwestern Ontario’s economy. Economists now suggest that the tariff pause might stabilize markets, albeit temporarily.
“This truce won’t solve all the problems, but it will buy time for companies in Thunder Bay and across the region to adjust inventories, secure supply lines, and perhaps regain some lost export opportunities,” said Zhiwei Zhang, chief economist at Pinpoint Asset Management.
Looking Ahead
The agreement also saw discussions on broader issues, including export restrictions on rare earth elements—critical for battery technologies and clean energy sectors where Thunder Bay entrepreneurs are increasingly active.
While the truce has sparked optimism in global markets, including gains in stock futures and a stronger U.S. dollar, experts caution that the reprieve is temporary. If talks fail to produce a lasting deal, tariffs could snap back, renewing pressures on industries in Ontario and beyond.
