Business and political leaders in Canada say there will be pain if Donald Trump follows through on his pledge to impose a 25 per cent tariff on all Canadian goods, but they note the hurt will happen in his country as well.
The president-elect posted to Truth Social on Monday he will sign an executive order imposing a 25 per cent tariff on all products coming in to the United States from Canada and Mexico.
He said the tariff will remain in place until both countries stop drugs, in particular fentanyl, and people from illegally crossing the borders.
The threat was met with a call to action by the Canadian Chamber of Commerce, which said Canada needs to urgently adapt its approach to trade talks with the U.S.
The chamberB次元官网网址檚 president and CEO Candace Laing said that B次元官网网址渂eing AmericaB次元官网网址檚 B次元官网网址榥ice neighbourB次元官网网址� wonB次元官网网址檛 get us anywhere.B次元官网网址�
B次元官网网址淧resident-elect TrumpB次元官网网址檚 intention to impose 25 per cent tariffs signals that the U.S.-Canada trade relationship is no longer about mutual benefit. To him, itB次元官网网址檚 about winners and losers B次元官网网址� with Canada on the losing end,B次元官网网址� said Laing in a statement on Tuesday.
B次元官网网址淲eB次元官网网址檙e facing a significant shift in the relationship between long-standing allies. CanadaB次元官网网址檚 signature approach needs to evolve: we must be prepared to take a couple of punches if weB次元官网网址檙e going to stake out our position. ItB次元官网网址檚 time to trade B次元官网网址榮orryB次元官网网址� for B次元官网网址榮orry, not sorry.B次元官网网址橞次元官网网址�
Prime Minister Justin Trudeau told reporters on Tuesday that he spoke with Trump after the president-electB次元官网网址檚 announcement on social media and described it as B次元官网网址渁 good call.B次元官网网址�
B次元官网网址淲e talked about some of the challenges that we can work on together,B次元官网网址� he said.
B次元官网网址淭his is something that we can do: laying out the facts, moving forward in constructive ways. This is a relationship that we know takes a certain amount of working on and thatB次元官网网址檚 what weB次元官网网址檒l do.B次元官网网址�
The two leaders agreed to stay in touch. Trudeau said he also had calls with Ontario Premier Doug Ford and Quebec Premier Fran莽ois Legault, and agreed to hold a first ministers meeting this week B次元官网网址渢o talk about the United States.B次元官网网址�
B次元官网网址淥ne of the really important things is that we be all pulling together on this,B次元官网网址� Trudeau said.
B次元官网网址淭he B次元官网网址楾eam CanadaB次元官网网址� approach is what works.B次元官网网址�
Previous modelling by the Canadian Chamber of Commerce suggested a 10 per cent across-the-board tariff would reduce the size of the Canadian economy between 0.9 and one per cent, resulting in around $30 billion per year in economic costs.
It estimated the U.S. would see around US$125 billion a year in economic costs.
University of Calgary economist Trevor Tombe, who authored the chamberB次元官网网址檚 report on that modelling before the U.S. election, said on X that the Canadian economy would take an annual real GDP hit of around 2.6 per cent when updating for a 25 per cent tariff.
That would equate to around $2,000 per person, he said.
Ford posted on social media that a 25 per cent tariff would be devastating to workers and jobs in both Canada and the U.S.
Legault tweeted that everything must be done to avoid the tariffs, and British Columbia Premier David Eby posted TrumpB次元官网网址檚 tariffs B次元官网网址渨ould hurt Canadians and Americans alike.B次元官网网址�
B次元官网网址淐anadians must stand united. Ottawa must respond with strength,B次元官网网址� Eby tweeted.
Alberta Premier Danielle Smith said in a social media post that the Trump administration has B次元官网网址渧alid concerns related to illegal activitiesB次元官网网址� at the border. But she noted vast majority of her provinceB次元官网网址檚 energy exports to the U.S. are B次元官网网址渄elivered through secure and safe pipelinesB次元官网网址� which she said B次元官网网址渄o not in any way contribute to these illegal activities.B次元官网网址�
Canadian American Business Council CEO Beth Burke said in a statement Monday night that TrumpB次元官网网址檚 proposal would harm businesses on both sides of the border and would B次元官网网址渆rode the economic and geopolitical strength of North America.B次元官网网址�
The Canadian dollar traded for 71.02 cents US early Tuesday morning, down from 71.53 cents US on Monday.
Some warned a potential blanket tariff would also be bad for businesses on the U.S. side of the border.
B次元官网网址淔or the American businesses and for American consumers, this would mean higher prices and increased costs for input and less competitive business environment for America as well,B次元官网网址� the Canadian Chamber of CommerceB次元官网网址檚 chief economist, Stephen Tapp, said in an interview late Monday.
Things would be even worse if other countries retaliated with tariff walls of their own. In that case, Canadian incomes would fall by 1.5 per cent and productivity by 1.6 per cent, the chamberB次元官网网址檚 report said.
Tapp said in this case it would amount to USD $2,000 less in purchasing power for the American consumer. The numbers are even higher with a 25 per cent tariff.
He suspects that increased cost would not be appreciated in a U.S. that voted for TrumpB次元官网网址檚 promises of reducing inflation and the cost of living.
B次元官网网址淐onsumers that have just gone through the pandemic and large inflation, then difficult times for Americans and Canadians, I think they would really not be happy to see prices go up and the sticker shock that they would feel after prices came in.B次元官网网址�
A joint statement from Deputy Prime Minister Chrystia Freeland and Public Safety Minister Dominic LeBlanc said Ottawa will continue to discuss border security issues with the incoming administration.
Even the threat of tariffs is bad for investment in Canadian business, Tapp said.
B次元官网网址淚t would be bad for overall sentiment in Canada for the consumer side,B次元官网网址� he said.
TrumpB次元官网网址檚 first tenure in the White House did show that Canadian businesses are resilient, Tapp said. They should prepare for a rush of orders before any tariffs come into play while also bracing for uncertainty and chaos in the four years that follow.
B次元官网网址淲e saw that we should take Trump seriously.B次元官网网址�
