‘Nobody wins’: ODU economist, state leaders warn of permanent damage from US-Canada trade war

As a high-stakes trade war escalates between the United States and Canada, local economists and state leaders are warning that Virginia is positioned directly in the blast of the fallout.

With new 50% tariffs imposed on Canadian imports taking effect, and retaliatory tariffs from Ottawa expected by September, experts say the disruption will economically claim victims across the Commonwealth.

According to Dr. Robert McNab, Chair of the Department of Economics and Director of the Dragas Center for Economic Analysis and Policy at Old Dominion University, the policy shift will cause immediate strain.

“It’s gonna be a shock to trade; trade volumes will decline from Canada, and higher prices will result, because those tariffs now being levied on Canadian goods will be almost exclusively be passed through to American consumers,” McNab said.

Data from the Observatory of Economic Complexity (OEC) highlights Canada as Virginia’s single largest export destination, absorbing approximately $3 billion in Commonwealth-produced goods in 2025. At the same time, Virginia relies heavily on imports, with nearly $3 billion in goods coming from Canada annually.

Governor Abigail Spanberger is bluntly assessing the real-world consequences of the escalating dispute.

“The consequences are catastrophic,” Spanberger said during questioning at a briefing on healthcare on Wednesday. “It is absolutely outrageous and ridiculous that the president is starting a trade war with Canada — 50% tariffs on Canadian goods — we’re expecting retaliatory tariffs to come in September.”

Beyond the immediate price hikes on everyday goods, trade experts warn that the economic damage could persist long after the political dispute settles.

“When this is all resolved, why would they come back to us?” McNab noted. “We’re getting viewed as an unstable partner, so nobody wins in an all-out trade war between the United States and Canada.”