With potential sweeping tariffs threatened by US President Donald Trump, Doug Ford, Ontario’s Premier, has instructed the Liquor Control Board of Ontario (LCBO) to remove American alcohol from its shelves. The Convenience Industry Council of Canada, representing 7,500 retailers in Ontario, has stated that such a move will not adversely affect local convenience stores.
In 2020, Ontario permitted the retail of alcohol through convenience, grocery, and big box stores, thus liberalising the market. However, the province also transformed its wholesale and delivery network and made LCBO the sole wholesaler for the entire province.
Anne Kothawala, President and CEO of the Convenience Industry Council, assured that Ontario’s convenience stores have a broad enough assortment of local products to meet customer needs. She added that the impact on convenience stores would be less significant as they do not sell spirits, which make up a larger percentage of US alcohol.
In the event of Trump’s threat being implemented, the Premier of Ontario plans to promote Ontario-made wines and spirits more extensively. Trump has hinted at imposing a 25 percent tariff on all Canadian and Mexican exports, a move that could potentially impact border security.
Retaliatory measures have been prepared by Ottawa and the provinces if these tariffs are imposed. As part of these measures, the LCBO could face restrictions on buying American products.
Gary Sands, senior vice-president of the Canadian Federation of Independent Grocers, agreed with Kothawala’s remarks, suggesting that the situation could provide an opportunity to reconsider Ontario’s alcohol modernization plan. He emphasized that independent stores are significant supporters of buying local and differentiating themselves from chains.
The convenience industry supports Ontario government’s efforts to defend against potential negative economic impacts on retailers, producers, and consumers, Kothawala added. Meanwhile, Ford has warned that a 25 percent tariff on Canadian goods could lead to a loss of 450,000 to 500,000 jobs in Ontario. As a result, the provincial government may have to spend billions to stimulate the economy, a decision that could potentially trigger an early election.
