« Recession's toll on employees continues to mount | Main | Loonie's rise may give reason to affix it to U.S. buck »

June 04, 2021

Rising loonie brings 'pain on top of pain'

By Jason Buckland, Sympatico / MSN Finance

Almost a month ago in this space, we tried to compare Canada’s ’09 tourism industry to that of Fallujah’s after news broke of incoming passport rules that would make it much tougher for Americans to make their way north.

Surely we were crazy to suggest that then, but … now? Maybe the number of guests visiting a war-torn Middle Eastern destination this summer is something Canada can shoot for, after all.

Things were already bad for Canadian tourism earlier this week when, starting June 1st, new passport rules made crossing the U.S. border a bit like tip-toeing through a minefield with Aretha Franklin on your back: tricky.

In order to make it across, you now must have a passport (or a new fancy driver’s license that isn’t out yet) where photo ID, a birth certificate and friendly nod would’ve done the job before.

What’s the big deal, you say? Well, the problem’s not on our side. While many Canadians have passports, only about one in four Americans have such documentation, meaning bye-bye to a major chunk of tourism bucks our economy counts on each year.

Of course, this is a recession -- the problems can’t stop there. As the loonie rises through the roof, it creates a dynamic that the Globe and Mail likes to call “pain on top of pain.” With the border restrictions and, now, the cost of the Canadian dollar compared to its U.S. counterpart, it makes even less sense for Americans to leave the States and bring their money into the Great White North.

And I know what some people are thinking, which is, Fine, good riddance. We don’t need a bunch of Yankees leaving trash and butchering our French street names to enjoy our country this summer. But the fact is, without U.S. tourist influence we lose out on millions of revenue dollars in a time where millions of revenue dollars is actually a big deal.

The issue is already a topic of ire out east, where New Brunswick’s Minister of Tourism and Parks is already anticipating the lost income. He’s begun promoting “staycations” to entice members of the province to remain in New Brunswick this summer to help combat some of the loss from lack of Americans.

Creates a bit of a dilemma for us, doesn’t it? Stay in the area and help pump much-needed money back into the Canadian economy or – with the advantage the loonie now has over the USD – take advantage of a quick trip to the States, where everything from lunch to a shopping spree or trip to the theme park is cheaper by comparison?



Post a comment


About the Authors

Deirdre McMurdy

Deirdre is a veteran business journalist and born-again policy wonk. She has covered corporate and financial markets news for 20 years in both print and broadcast at the Globe & Mail, Maclean’s, CTV’s Canada AM and...

Gordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

James Havers

James is the senior editor of Sympatico / MSN Finance living in Toronto. He has worked for the Nikkei Shimbun (Tokyo), canoe.ca, AOL.ca, Canadian Business and other publications. Havers turned to journalism after teaching overseas.

Joe Lee

Joe is the product manager of Sympatico / MSN Finance. While attending a journalism school in New York, he never thought that dollars and cents would later rule his career as a journalist. Despite meeting several savvy money experts...

Dawn Cuthbertson

Dawn is assistant editor of Sympatico/MSN Finance. With caviar dreams on a tuna can budget, she’s always looking for ways to save for a down payment and contribute more to her RRSP with a little left over for fun...