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Fallout of Trump’s threatened action would devastate both economies: ministers
Canada prepares to hit U.S. with billions in tariffs
W
ASHINGTON — Ottawa is
ready to retaliate if U.S. presi-
dent-elect Donald Trump slaps
Canada with devastating tariffs, Prime
Minister Justin Trudeau promised Fri-
day — and his ministers say Republic-
ans in Washington don’t fully under-
stand the impact of the duties on both
countries’ economies.
“We will not hesitate to act,” Trudeau
said at a meeting of the newly formed
Council on Canada-U.S. Relations in To-
ronto. “We will respond and, I will say it
again, everything is on the table.”
The incoming president has prom-
ised to apply 25 per cent across-the-
board tariffs on imports from Canada
when he returns to the White House on
Monday.
Foreign Affairs Minister Mélanie
Joly is in Washington this week and
met Thursday with Republican Senate
Majority Leader John Thune, as well
as Republicans Lindsey Graham and
James Risch, chairman of the U.S. Sen-
ate Foreign Relations Committee. She
said tariffs would launch a “trade war”
between Canada and the U.S.
“If we need to retaliate, we will do
so,” Joly told reporters Friday. “The
Americans would be starting a trade
war against us and this would be the
biggest trade war between Canada and
the U.S. in decades.”
Canada has multiple options for re-
taliatory tariffs ready to go depending
on what Trump ultimately does, said
two federal government sources with
knowledge of the tariff response plan.
They were not authorized to speak pub-
licly about details of the plan.
If Trump sets the tariffs at 25 per
cent, Canada’s response would be to im-
pose counter-tariffs worth roughly $37
billion, and possibly follow up with an-
other $110 billion in tariffs. If the dut-
ies are lower, Canada’s tariff response
would be more modest.
No decision will be made until Ottawa
sees the wording of Trump’s executive
order imposing the tariffs.
Energy and Natural Resources Min-
ister Jonathan Wilkinson, who was in
Washington this week, said Thursday
that Trump’s tariff plan isn’t even clear
to Republican senators and congress-
people.
Wilkinson said he’s heard about three
tariff options being considered: 25 per
cent tariffs, 10 per cent tariffs and a
lower duty that ratchets up over time.
The premiers disagree about how
Canada should respond if Trump fol-
lows through on his threats. Most
premiers presented a united front fol-
lowing a meeting with Trudeau in Ot-
tawa earlier this week.
Alberta Premier Danielle Smith
broke from the pack by refusing to con-
sider levies on oil exports.
Former finance minister Chrystia
Freeland, who confirmed her intention
to run for the Liberal leadership on Fri-
day, has suggested a dollar-for-dollar
tariff response. Trudeau has said he
supports the principle of a proportional
dollar-for-dollar response.
While Canada has been planning its
tariff response for weeks, Republicans
only recently returned to Capitol Hill,
said Joly.
Joly said she still hopes duties can be
avoided by making the case that tariffs
would damage both the Canadian and
American economies.
“When I talk about the tariffs them-
selves and their impact, people in Wash-
ington are surprised,” Joly said Friday.
“And when I mention the impacts of a
Trump tariff tax on Americans, they
are not only surprised, they are very
worried.”
Goods worth $3.6 billion cross the
border every day. A Canadian Chamber
of Commerce analysis said 25 per cent
tariffs could shrink Canada’s gross
domestic product by 2.6 per cent and
America’s by 1.6 per cent. It would also
disrupt the automotive, agriculture and
energy sectors, among others.
“Americans are just waking up to this
possibility,” Joly said.
Bea Bruske, president of the Can-
adian Labour Congress, told The Can-
adian Press her organization is “very
concerned” about the impact of tariffs
on jobs.
“We think that this is an all-hands-on-
deck moment where government, busi-
ness, labour needs to come together to
navigate how we’re going to respond,”
Bruske said, adding that workers’
voices need to be included in those con-
versations.
She said the sectors most vulnerable
to tariffs include manufacturing, min-
ing, the energy sector, agriculture and
forestry.
“These are the jobs that are really
the backbone of our economy across
the country and the different provinces
and regions,” Bruske said, adding that
job losses in those areas would have
spinoff effects on other sectors like re-
tail, education and health care.
She called for a “strong social safety
net” so that “if there are job disruptions
… workers can continue to be able to
function in the communities that they
live in.”
When asked about potential retalia-
tion measures, Bruske said it’s too ear-
ly to tell what they could look like. She
said counter-tariffs could work but a
trade war would hurt workers on both
sides of the border.
Bruske said the congress is working
with the labour movement in the U.S. to
identify opportunities for collaboration.
“Workers are feeling more and more
pressure being able to make ends meet
and an additional challenge in terms
of potential job losses is just one more
thing for people to worry about,” she
said.
—The Canadian Press
KELLY GERALDINE MALONE
JUSTIN TANG / THE CANADIAN PRESS FILES
Foreign Affairs
Minister Mélanie
Joly: biggest
trade war in
decades
;