Canada prepares for Trump’s response to tariffs: ‘In a trade war, there are no winners’

Ottawa, Canada – President-elect Donald Trump “We don’t need their cars. We don’t need their timber. We don’t need their dairy,” he said, referring to Canada at his Mar-a-Lago news conference last week, when he reiterated his thoughts on annexation. The United States’ northern neighbor and his plan to impose a “serious” and “significant” tariff on it, which he said would reach 25% on Canadian exports.

The United States depends on trade with Canada, which provides 60% of US crude oil imports. Last July, production reached a record level 4.3 million barrels per day.

“Who owns the critical minerals? We do,” Doug Ford, Premier of Ontario, Canada’s largest province, said in an interview. “Who has the high-quality nickel that the United States needs for manufacturing and for the military? We do.”

According to the US Census Bureau, the United States exported more than $322 billion in goods to Canada between January and November 2024. During the same period, the United States imported more than $377 billion in goods from Canada, resulting in A trade deficit of approximately $55 billion.

Trump says US support for Canada ‘meaningless’, suggests Canadians want to ‘become the 51st state’

Trump has repeatedly mentioned that the United States supports Canada, which has risen from $100 million to $100 billion to “about $200 billion a year,” he said in his recent press conference at Mar-a-Lago.

Nearly $2.7 billion in goods and services cross the Canada-US border every day, and Canada is the top export destination for 36 US states. Canada relies heavily on that economic partnership, with 75% of its exports going to the United States, Tyler Chamberlain, a professor of international business at the University of Ottawa, told FOX Business.

“Trade represents 67% of Canada’s economy,” he said. In comparison, foreign trade represented 25% of the gross domestic product or US economy in 2023, according to World Bank data.

“Anything related to trade has an amplified effect on us compared to the United States, so the proposed tariffs are concerning to Canadians,” Chamberlain said. “It will be the greatest hit of all time.” He added that Americans should be concerned, too.

“Industries in the United States that rely on supplies coming from Canada will have to impose higher duties on their products because of any tariffs imposed on them,” Chamberlain said.

Reuters recently reported that Trump is considering using the International Emergency Economic Powers Act to declare a national economic emergency to justify imposing tariffs on Canada.

Canadian Trudeau announces his resignation after partisan pressure amid criticism of Trump and his handling of the budget

On the same day, Premier of Ontario He put forward an idea that could prevent the punitive action Trump is planning against Canada. The Ford government unveiled “Fortress Am-Can,” which aims to achieve “energy security and strong economic growth” between the United States and Canada on both sides of the border.

Energy accounts for about a third of Canada’s trade with the United States. The plan includes simplifying approvals for pipelines, as well as large and small nuclear reactors. However, Ford told FOX Business that Ontario is also prepared to take retaliatory measures that “would send a message to the United States” in response to the imposition of sweeping US tariffs.

He and his fellow Canadian prime ministers will meet Prime Minister Justin Trudeau Next Wednesday in Ottawa to discuss next steps.

On Friday, Trudeau told CNN that if Trump goes ahead with tariffs, Canada will respond as it did when Trump imposed tariffs on steel and aluminum several years ago. “We responded by imposing tariffs on Heinz ketchup, on playing cards, on bourbon, on Harley Davidson, on things that would hurt American workers,” he explained.

CBC News It was reported last week that retaliatory tariffs could target steel products — manufactured in key swing states Michigan and Pennsylvania — along with orange juice made in Trump’s home state of Florida, according to an unnamed senior Canadian government source.

Energy exports could also be used as leverage to push the incoming Trump administration to impose tariffs on Canada.

Last month, Ontario’s premier threatened to cut off energy supplies from Ontario to several US states, including New York, Michigan and Minnesota. According to its spokesperson, Grace Lee, Ontario will power 1.5 million American homes in 2023.

Next month, Ford and his state and regional colleagues will travel to Washington, D.C., and meet with U.S. lawmakers in an effort to stop the tariffs.

Who is Pierre Poilievre? Canadian Conservative leader seeks to become the next prime minister after Trudeau’s exit

Alberta Premier Danielle Smith met with Trump over the weekend.

“We had a friendly and constructive conversation during which I emphasized the mutual importance of the U.S.-Canada energy relationship and, specifically, how hundreds of thousands of American jobs are supported by Alberta’s energy exports. I was also able to have similar discussions with several key allies.” “For the incoming administration, we were encouraged to hear of their support for a strong energy and security relationship with Canada.”

Before the meeting, former Canadian Cabinet Minister Beren Beatty, who most recently served as president and CEO of the Canadian Chamber of Commerce, said Trudeau should have done what Smith and Ford did to present Canada’s position and “build an electoral base.” In the United States, I confirm that the Americans realize that it is in their interest to maintain a strong relationship with Canada.”

An independent expert group on Canada-US relations, which Beatty co-chairs, said in a statement that it called for a “Canada First” response to Trump, and that “Canada cannot simply submit to his every whim and demand.”

The group said Canada should instead pressure “the new administration to act on areas important to our country, including reducing the flow of drugs and weapons from the United States to Canada.”

Beyond the tariff issue, Canada needs to prepare to renegotiate the United States-Mexico-Canada Agreement (USMCA), which in 2020 will replace the North American Free Trade Agreement (NAFTA). Beatty – who served in former Canadian Prime Minister Brian Mulroney’s Progressive Conservative government that helped craft NAFTA’s predecessor, the Canada-United States Free Trade Agreement, with Reagan administration – He said that at this time next year, the Trump White House is expected to inform Congress of its desire to renegotiate the USMCA over the next decade.

Last October, Trump said that “upon taking office,” he would notify Canada and Mexico “of his intention to activate the six-year renegotiation provision in the USMCA that I put in place,” he told a FOX Business Network anchor. Maria Bartiromo EIn an interview, “Make it a much better deal.”

‘Shark Tank’ Star Kevin O’Leary Supports Trump’s Idea to Make Canada the 51st US State: ‘The Potential Is Huge’

Beatty, the former Canadian foreign minister, said Trump’s references to the trade imbalance between the United States and Canada “consist mostly of selling Canadian energy to the United States at a discount to world prices.”

“Instead of the United States supporting Canada by purchasing this energy, Canada is supporting the United States because of our government’s failure to create the infrastructure that allows us to properly serve global markets,” Beatty said.

Beatty, who also served as Canada’s defense minister, noted that Canada and the United States are security partners in the North American Aerospace Defense Command and share a partnership in the defense industrial base. “When Mr. Trump harms our economy, he also harms the security of the United States in the process,” Beatty said.

In his view, the past should guide the future.

Beatty pointed to the tariff law — known as the Smoot-Hawley Tariff, which Congress passed in 1930 — which implemented protectionist trade policies. Canada was the first country to respond by imposing new tariffs on 16 products, representing about 30% of US exports to Canada.

CLICK HERE TO GET THE FOX NEWS APP

“Smoot-Hawley did not cause the Great Depression,” Beatty said. “But he lengthened it and deepened it.”

“Unfortunately, we do not learn from history,” he said. “In a trade war, there are no winners. There are only losers.”

Reuters contributed to this report.