Cruise lines caught in the middle of US-Canada trade war
Cruise companies find themselves caught in the crossfire thanks to retaliatory tariffs from both sides
The ongoing trade war between the United States and Canada has put cruise lines in a precarious situation that will have adverse repercussions on all sides.
Since US President Donald Trump signed an executive order to impose new tariffs on imports from Canada on 1st February, Canadians have stepped up to the plate following now-former Prime Minister Justin Trudeau’s “Choose Canada” response.
This has led to the cancellation of cruises sailing to and from US ports aboard US-based cruise firms for many Canadians.
Experts have pointed out that this act of patriotism will spell major economic losses for the US, given how Canada is actually its largest tourism source market.
It has been estimated that even a mere ten percent drop in Canadian travel will lead to a loss of up to US$2.1 billion in tourism revenues, and will lead to 14,000 jobs lost.
Alaska has the most to lose in this case, given how a large number of Alaskan cruises set off from the Canadian port city of Vancouver.
Retaliatory statements
British Columbia premier David Eby recently proposed a new bill allowing the Canadian province to charge additional tolls and fees on US commercial vehicles travelling through to Alaska.
Retaliation against the proposal from the Americans has been swift, with Alaskan senator Dan Sullivan making a counter-proposal: a possible exemption to a law requiring cruise ships travelling from the lower 48 states to Alaska to stop at a Canadian port.
Sullivan declared: “That will take billions and I’m talking billions of dollars of tourism revenue from western Canadian provinces.”
There are actually two US laws involved in this scenario: the Merchant Marine Act of 1920 which is commonly known as the Jones Act, and the much older Passenger Vessel Services Act (PVSA) of 1886.
Both laws specifically require that foreign-flagged cruise lines call on a foreign port of call during any cruise that begins and ends in a US port.
This is why most Alaska cruises sailing roundtrip from a mainland US port like Seattle stop in Victoria, British Columbia.
In this scenario, Victoria, British Columbia stands to lose the most.
Cruise tourism contributes about $130 million annually to Victoria’s local economy, as Breakwater District at Ogden Point is Canada’s busiest port for cruise ship calls.
The Greater Victoria Harbour Authority (GVHA) reports that, of the nearly 970,000 passengers cruising to Victoria on 316 cruise ship calls in 2024, over 700,000 disembarked to explore the city.
According to GVHA chief executive Robert Lewis-Manning: “The industry remains a strong economic driver for Victoria. The Alaska itinerary is an important growth market.”
The GVHA expects around 320 cruise ship arrivals this year.
