Canada appears to have dodged the bullet of tariffs announced yesterday by President Donald Trump – something he called Liberation Day. The president outlined a broad range of reciprocal tariffs against countries around the world that he claims were causing the U.S. economic harm, but Canada and Mexico were not included.
Among the first to react was Ontario Premier Doug Ford, who, like many other Canadian politicians, is trying to determine how Canada will be affected, even though it wasn’t on the list of countries targeted for reciprocal tariffs.
“The positive thing that I saw was that we weren’t on that list. We weren’t on page one, we weren’t on page two, we weren’t on page three, ourselves and Mexico. So, we’re going to stay tuned. Let’s hope that there’s some positive news coming,” Ford said.
Prime Minister Mark Carney stepped away from his election campaign to meet with his Canada-U.S. relations committee to also discuss Trump’s latest tariff announcement. Carney says Trump’s series of measures will fundamentally change the international trading system.
“Now, in doing so he has preserved a number of important elements of our relationship, the commercial relationship between Canada and the United States. But the fentanyl tariffs still remain in place, as do the tariffs for steel and aluminum. As of this evening the tariffs on automobiles will enter into force. And the US has signaled that there will be additional tariffs in so-called strategic sectors, pharmaceuticals, lumber, and semiconductors,” Carney said. “So, we’re in a situation where there’s going to be an impact on the US economy, which will be built with time; in our judgment, it will be negative on the US economy, which will have an impact on us. But the series of measures will directly affect millions of Canadians. We’re going to fight these tariffs with countermeasures.”
Canada’s auto industry has been bracing for this day for weeks, but there was no sense of relief from them. Drew Dilkins is the mayor of Windsor, Ontario, a major hub for the country’s auto manufacturing.
‘It could be catastrophic. And we’ve said that from the very beginning. So, a tariff of 25 percent was the number that was originally proposed, it would have an immediate impact on the auto industry and the parts sector here in the city of Windsor and throughout Essex County. But that would ripple all the way throughout Ontario. It would ripple all the way into the states of Michigan, Indiana, Ohio, and Kentucky,” Dilkins said.
Stephen Poloz is a former governor of the Bank of Canada. He says the impact will be a shock worldwide, but also believes it will impact the United States as well.
“Even already the investment and housing and so on have slowed quite significantly in the United States. They’re even talking about recession indicators flashing red in the United States, already. So perhaps the president won’t be satisfied with his initiative until he has created the greatest recession ever. Or something like that from a global standpoint,” Poloz said.
Some observers, including former Canadian ambassador to the U.S. Derek Burney, say there must be a dynamic shift in Canada towards trade. He says Canada will not be able to compete based on the amount of investment that Trump says will be coming to the U.S. – and warns Canada needs an overhaul just to survive. Everything from economic policies to taxes and regulations.
