BINGWI NEYAASI ANISHINAABEK — Following his inauguration on Monday, U.S. President Donald Trump announced that he intends to sign an executive order that would apply 25 per cent tariffs on all goods crossing the border from Canada, and it could take effect as soon as February 1.
In a speech to the World Economic Forum on Thursday, he added that the U.S. doesn’t need Canadian resources, citing an abundance of domestic resources and a $200-250 billion trade deficit with Canada.
If Trump follows through on that threat, experts predict a 1,500,000 Canadian job losses. The resource extractive industries, on which many northern Ontario local economies depend, would be hit hard.
The Ontario Mining Association has yet to calculate the potential impact of tariffs on the north, where there are 36 active mines that extracted a combined $15.7 billion worth of minerals in 2023.In a written statement provided to Ricochet, OMA president Priya Tandon said the prospect of 25 per cent blanket tariffs is “undoubtedly worrisome.” She added OMA is working with members and governments to assess the implications.Ontario Forestry Industries Association president Ian Dunn was more direct.
“If it does happen, and if it’s 25 per cent for a long period of time, it’s going to erase a huge section of our forest industry,” Dunn said.
By his account, 97 per cent of Ontario’s forestry products cross the Canada-U.S. border. Dunn said the simple math puts $2 billion of the sector’s $8-billion production at risk.
Lumber exports are most vulnerable. The U.S. has a 14-per-cent tariff on lumber, which is projected to increase 35 per cent in November. If Trump’s promised tariffs transpire, Canadian lumber exports entering their near-exclusive marketplace would face a potentially prohibitive 60-per-cent cost increase before entering the American marketplace.
An existential threat to some Indigenous communities
If the winds of trade shift so quickly and drastically, it could be existential for Bingwi Neyaasi Anishinaabek (Sand Point First Nation), whose leaders are counting on a small sawmill to bring its members home.
The mill on the shore of Lake Nipigon employs only five people, a small part in the supply chain for the Resolute sawmill, 180 kilometres southwest in Thunder Bay.
Ontario expropriated the reserve land in the 1950s to build a provincial park. The members were dispersed until they won the right to move back in 2010.
There are only 30 people living on reserve today. The plan has been to expand the sawmill until it can handle producing the structural lumber that could be used to build homes for members to return to their land.
Under the right conditions, with the sawmill and other spinoffs from the million-hectare Nipigon Lake Forest that the area’s First Nations manage, Bingwi Neyaashi Anishinaabek could build a sustainable economy.
Those conditions might instead be getting a lot worse.
“We’re all holding our breaths,” said Jordan Hatton, Bingwi Neyaashi Anishinaabek's director of economic development. “Not just for Sand Point, not just for the sawmill, but for other projects or developments we’re working on right now. There’s a lot of uncertainty, and uncertainty creates fear because we’re just not sure right now.”
Amid the fear and uncertainty, however, some business voices believe applying a 230-year-old law against Trump’s proposed tariffs could represent the biggest opportunity for First Nations-owned resource companies in living memory.
Thunder Bay Chamber of Commerce past president Jason Thompson believes the moment has come to test the Jay Treaty.
What is the Jay Treaty?
The United States and Great Britain signed the Treaty of Amity, Commerce, and Navigation, better known as the Jay Treaty, in 1794. Amid outstanding matters it settled from the American Revolutionary War, the agreement also recognized the rights of Indigenous peoples born on both sides of the Canada-U.S. border to work and travel freely across it.
“There is no border for us,” Thompson said. “It’s only since Canada and the U.S. formed that there is one.”
Indigenous people can cross the border using either a status card, a letter of ancestry, or from the U.S. side, a letter verifying “at least 50 per cent “American Indian blood,” an eligibility known as blood quantum.
On goods, it’s complicated.
On two separate occasions in 1948 and 1950, Canada confiscated a washing machine, a refrigerator, and an oil heater that a St. Regis Indian Reserve (Akwesasne 59) member brought across the border from New York State into Quebec. He paid $123.66 in duty charges under protest, then challenged the charge under the following provision of the Jay Treaty:“No Duty on Entry shall ever be levied by either Party on Peltries brought by Land, or Inland Navigation into the said Territories respectively, nor shall the Indians passing or repassing with their own proper Goods and Effects of whatever nature, pay for the same any Impost or Duty whatever. But Goods in Bales or other large Packages unusual among Indians shall not be considered as Goods belonging bona fide to Indians.”
In 1956, the Supreme Court of Canada declared the Jay Treaty provisions for Indigenous travel and trade didn’t apply, because the treaty was cancelled during the Canada-U.S. War of 1812. Moreover, Parliament has never passed a legislative or regulatory framework for cross-border Indigenous trade.
But Indigenous peoples continue to fight for those rights. The federal government agreed to hear their concerns a decade ago, which Canada expressed through a 2016 Senate report. The report focuses on mobility and not commercial interests. Canada, at the request of Mohawks of Akwesasne at the end of that process, launched a digital identification card in 2019 for individual cross-border use.
Conversations accelerated in 2021 after Canada passed the United Nations Declaration on the Rights of Indigenous Peoples Act, publishing an implementation action plan in 2023.
Canada has yet to commit anything unique regarding cross-border, Indigenous corporate trade. But over this time, Thompson says, Indigenous community and business leaders have been holding meetings and testing markets for prospective international agreements.
As a board member of the Anishnawbe Business Professional Association, he has been privy to three years of deepening plans among Indigenous business leaders, particularly in the resource extractive industries, to integrate their economies and bypass the regulations of colonial governments.
“Anything resource based — whether it’s mining, energy, forestry, you name it — there’s an appetite from both sides of the border to work on a nation-to-nation type of level,” Thompson said. “I think this (Trump’s tariff threat) is going to help kickstart that and get it done a little quicker.”
To incite that strategy, someone would have to take a chance on exercising the Indigenous trade provision of the Jay Treaty through the courts. First Nation parties to business deals with American tribes would have to challenge paying border costs, arguing their nation-to-nation agreements supercede Trump’s tariffs. But considering the stakes, that may happen sooner than later.
“As an Indigenous person, it excites me to see Indigenous organizations mobilizing around it (the Jay Treaty) to push it, to test it,” said John Desjarlais, the executive director of the Indigenous Resource Network.
“It’s one of the oldest existing treaties that affects border trade. It’s an incredible opportunity to push it and create nation-to-nation trade, where you can be exempt from those tariffs and not have to worry about posturing. And then you can build stronger, more resilient, sustainable economies from that.”
The Indigenous Resource Network is an advocacy organization for Indigenous resource sector workers and business owners. Desjarlais says Indigenous workers are statistically in the most precarious labour positions.
While the mining industry employs 17,300 Indigenous people in Canada, for example, the economic health of their communities has also become directly tied to the success of the projects that are likely to be casualties of a trade war.
“A lot of those industries are primary revenue sources for those communities. They’re much more vulnerable because they don’t have the ability to pivot into different industries,” Desjarlais said.
Since 2000, Indigenous communities across Canada have signed 524 resource agreements with governments, as well as exploration and resource extraction companies. In northern Ontario, those agreements tend to be project-specific contracts between the companies and the closest First Nations.
But in 2018, Ontario signed a revenue sharing agreement with Grand Council Treaty #3, Wabun and Mushkegowuk councils that committed a percentage of revenue for resources extracted throughout their territories. That opened the door to bind economic growth to resource extraction in 41 First Nations across northern Ontario.
Desjarlais is most familiar with the efforts of Saskatchewan First Nations to vertically integrate the value chain, from forest management to logging to finished manufacturing. He sees players in those more developed Indigenous resource economies as best positioned to assert international law and develop an Indigenous trade network independent of Canada or the United States.
A high stakes gamble
That seems a long way from the five-employee sawmill in Bingwi Neyaasi Anishinaabek, but the stakes are equally high. Hatton’s community has bet the future of resettlement itself on forestry growth.
His staff couldn’t likely punch through the border alone, but even small players would gain a considerable comparative advantage from tariff exemption, if Indigenous communities and companies were to open an exclusive resource trade route in the Midwest.
“In the past, we’ve looked at potential opportunities of having tribal trade from the United States and First Nations in Canada,” Hatton said. “I think potentially this issue with the tariffs might bring that around. BNA is very interested in those conversations. We haven’t been at the forefront of them, by any means, but we’d like to see where it goes. Because if these tariffs go into effect, what are the alternatives? That might be one.”
Ricochet / Local Journalism Initiative
