In the face of hefty U.S.-imposed tariffs, Tuesday’s budget being tabled in Victoria is going to have a hyper-focus on stabilizing and strengthening the economy. You can also expect the province to dive deeper into the red as the debt ceiling goes up.

Jairo Yunis, director of policy at the Business Council of BC, tells 1130 NewsRadio this going to be a difficult budget for the government to sell.

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“They have to figure out how to factor in the uncertainty of tariffs into their revenue and spending projections,” said Yunis.

“But it is a real opportunity also to signal to the business community that the province is really walking the talk and committed to fiscal stability and to improving the province’s competitiveness.”

What’s tricky is showing other provinces and countries that B.C. is the place to invest.

“The government has to make its case. What is our value added as a province? Are we a province that is open to natural resource development or are we a province that is not able to balance economic growth with environmental protection? Are we a province that has a tax structure that will encourage private sector investment or are we a province that is going to deter investment from the private sector? Those are the questions the government should be asking.”

Last month, Premier David Eby announced B.C. is fast-tracking 18 resource projects to help the province rely less on the U.S.

“Exports to the U.S. are seven per cent of our economy. It’s over $30 billion. The preliminary economic assessment done by the finance ministry said if tariffs are in place and Canada retaliates, it would be a hit of around $69 billion, 120,000 jobs losses by 2028, but it is very challenging to bake in all these projections,” said Yunis.

The government will also need to outline a game plan to protect jobs, Yunis says especially in the private sector where growth has slowed over the last five years.

“The tariffs are going to be a supply side shock that’s very different than what we [experienced] during COVID — that was a largely demand driven shock. This is an attack not on consumption, but an attack on our exports, an attack on our industrial base. That’s why we have to make sure our industrial base remains in B.C. The incentive framework is in place, we continue to develop and grow our industries and these industries, mining, natural gas, agriculture, forestry, fishing are 70 per cent of our exports to the U.S. and they are the most productive sectors of the economy.”

Remember, during last fall’s provincial election, the BC NDP projected the budget deficit this year would rise to $9.6 billion — up the from $6.7 billion forecast.

“A key question will be whether those projections have improved or worsened in this budget, but we need to see some spending restraint from the province.”

With so much of a focus on tariffs, Yunis says don’t expect much money, if any, to be thrown at other big-ticket items like health care, housing, cost of living, and education.

“If we have a growing economy, we will have the necessary revenue to use and spend on those essential public services. We can’t fund those services if we don’t have a growing pie, and that’s part of the response.”

“British Columbians have also been through the ringer over the last few years given the inflationary pressures that we’ve been feeling over the last couple of years, but more spending doesn’t necessarily solve all of the issues.”

In the days and weeks ahead, he points out pressure will be amped up on breaking down interprovincial trade barriers, which remain up for the time being.

“We’re not heading into this in the greatest of shapes, but that’s the past. Right now what we have to do is focus on strengthening the economy. It is the irony that we’re worrying about our ability to trade north to south, but there’s no free trade east to west.”

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