Canada Prepares for Possible Retaliatory Tariffs Against US Products
TL/DR –
Donald Trump has threatened to impose a 25% tariff on all products from Canada and Mexico as part of his effort to halt the flow of drugs and migrants across the borders. In response, Canada is reportedly considering potential retaliatory tariffs on certain US goods, although no decision has yet been made. During Trump’s first term, other countries responded to his higher tariffs with reciprocal duties; Canada, for instance, imposed billions in new duties in 2018 in response to new taxes on its steel and aluminium.
Canada Considers Retaliatory Tariffs Against U.S
Canada is contemplating retaliatory tariffs against US goods if President-elect Donald Trump implements his proposed sweeping tariffs on Canadian products, according to a top official.
Key Points
- Trump, set to impose tariffs on goods from Canada and Mexico, aims to halt the migration and drug flow across borders.
- A 25% tax on products entering the U.S. from these countries is one of his initial executive orders.
- Canada is already strategizing potential targets for retaliatory tariffs, though no final decision has been made.
Trump’s commitment to curb migration was seen when he shared his productive conversation with Mexico’s new President Claudia Sheinbaum. She agreed to stop migration through Mexico effectively immediately, though its impact on tariff imposition remains unclear.
Canada has begun strategizing potential retaliatory targets. Products were chosen during Trump’s first term for political impact over economic. For instance, yogurt imports from U.S.’s Wisconsin were hit with a 10% duty, affecting then-House Speaker Paul Ryan’s state.
Trump’s threat comes amidst a surge of illegal migrants, though numbers at the Canadian border are significantly lower than the southern border. In October alone, U.S. Border Patrol reported 56,530 arrests at the Mexican border compared to 23,721 arrests at the Canadian border between October 2023 and September 2024.
Canada aims to work alongside Trump to decrease these numbers and is fearful of a potential influx of migrants in the case of mass deportations. They argue that tariffs will deeply affect both nations, as Canada is the largest export destination for 36 U.S. states, with nearly $2.7 billion worth of goods and services crossing the border each day.
Prime Minister Justin Trudeau held an emergency meeting with provincial leaders to discuss the situation. The provincial premiers are insisting Trudeau negotiate a trade deal with the U.S. that excludes Mexico.
Similar to Canada, Mexico is also considering possible retaliatory tariffs. Though, President Sheinbaum expressed optimism following her “excellent conversation” with Trump.
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