Ontario Cancels $100 Million Starlink Contract in Tariff Dispute

Tech
By 24matins.uk,  published 3 February 2025 at 21h01, updated on 3 February 2025 at 21h01.
Tech

In response to specific tax implementations, Ontario has chosen to terminate its $100 million contract with Elon Musk's satellite company, Starlink.

Doug Ford, Ontario’s Premier and a former avid supporter of ex-President Trump, recently announced the cancellation of a $100 million contract with Elon Musk’s Starlink. Signed last November, the deal aimed to bring internet services to the province’s remote areas.

Triggered by Trump’s Trade War

The decision follows Trump’s imposition of a 25% tariff on nearly all Canadian imports. In retaliation, Canada set a matching 25% tariff on U.S. goods, escalating fears of a trade war. Trump claims the tariffs are to combat fentanyl, although less than one percent of this drug enters the U.S. from Canada, as confirmed by Canadian Prime Minister Justin Trudeau and the US Drug Enforcement Administration.

Elon Musk, the world’s richest man and a close confidant of Trump, now leads the Department of Government Efficiency (DOGE), a group focused on cutting costs and deregulation. “He has access to the federal payment system and certain U.S. Treasury levers,” despite being a private citizen and not elected.

Impact on Ontario

Ford perceives Musk’s connection to Trump’s tariffs as a direct threat. He stated that Ontario “will not do business with those intent on destroying our economy” and accused Musk of trying to “starve” hardworking Canadians. The contract remains void until the American tariffs are lifted, and all U.S. companies are now barred from provincial contracts, potentially costing local businesses “tens of billions in new revenue.”

Ford also directed the Ontario Liquor Board to remove American spirits from shelves, a move echoed by other provincial leaders. “Every year, the LCBO sells about a billion dollars worth of American wine, beer, spirits, and seltzers. Not anymore,” he announced. In response, Musk simply posted “too bad” on X.