OTTAWA — The breather didn’t final.
Late on his first day in workplace, U.S. President Donald Trump stated he “thinks” he’ll slap 25 per cent tariffs on Canada and Mexico as early as Feb. 1, referring as soon as once more to frame issues about immigration and drug smuggling.
“We’re thinking in terms of 25 per cent on Mexico and Canada because they’re allowing vast numbers of people — Canada is a very bad abuser also — to come in and fentanyl to come in,” Trump stated. “I think we’ll do it on Feb. 1. On each.”
Prime Minister Justin Trudeau had earlier acknowledged solely that Trump’s inaugural deal with revealed no punishing tariffs on Canadian merchandise “for now.”
However no one within the federal Liberal authorities had assumed Canada would escape unscathed from Trump’s new assessment of “unfair” commerce relations and vow to fill America’s coffers with tariff income.
By night, Trump was riffing on tariffs and a complete vary of matters with reporters gathered within the Oval Workplace, as he continued to signal government orders, as he had all through the day.
Nevertheless, Trump’s phrases, and his government order setting out directives for his new “America First trade policy” had been at odds.
Within the textual content of his order, Trump instructed his commerce and homeland safety secretaries to evaluate “the unlawful migration and fentanyl flows” from Canada, Mexico and China, to advocate “appropriate trade and national security measure, and to report back to him by April 1, not Feb. 1.
In Montebello, in response to Trump’s late-day warning, Finance Minister Dominic LeBlanc said “frankly there is nothing new” within the president’s assertion, and that the federal government had ready reciprocal tariffs to reply to something that Trump does.
“The plan is ready,” he stated.
LeBlanc and International Affairs Minister Melanie Joly stated Canada will proceed to argue “it would be a mistake” for Trump to proceed together with his risk.
Trump speculated that he may nonetheless levy a common 10 per cent tariff on all international imports to the U.S., however “we’re not ready for that yet,” he stated.
It got here lengthy after his inaugural deal with Monday morning. At the moment, Trump made clear he has overseas producers and America’s allies and rivals in his crosshairs, promising an “overhaul of our trade system to protect American workers and families.”
Although U.S. President Donald Trump’s workforce indicated he would not hit Canada with damaging tariffs on his inauguration day, Canadian politicians and enterprise teams remained cautious tariffs might nonetheless be on the horizon. (Jan. 20, 2025 / The Canadian Press)
Trump initially stopped wanting imposing his threatened 25 per cent tariff on Canadian and Mexican items — a transfer the Trudeau authorities has stated would “devastate” Canada’s financial system and damage American companies and shoppers compelled to pay extra for Canadian vitality, minerals, meals and agricultural merchandise.
Nevertheless, as a part of a revived “America First” commerce coverage, Trump introduced the creation of an Exterior Income Service to scoop up tariff and tax income from overseas international locations, saying he was “saved by God to make America great again.”
Trump promised to place American producers, automakers and employees first.
Earlier when requested whether or not Canada had escaped the worst, LeBlanc stated “reprieve” was too sturdy a phrase. Different ministers stated they had been “encouraged” or “motivated” by an opportunity to maintain making the case, as they’ve for months, that Canada is integral to American financial and nationwide safety.
When Trump’s first administration known as for a renegotiation of the North American Free Commerce Settlement, the primary Trudeau authorities stated it welcomed the problem and would search progressive adjustments in a brand new deal. (Neither received precisely what it needed out of that first renegotiation.)
International Affairs Minister Melanie Joly says the federal government continues to be working to stop the Trump administration from imposing punishing tariffs, and on a doable Canadian response in case that occurs. The federal cupboard is assembly for 2 days to debate doable tariffs after Trump’s inauguration. (Jan. 20, 2025 / The Canadian Press)
On Monday, LeBlanc tried to current a equally rosy view of the rocky highway forward.
“If the administration wants to study the economic and trade relationship between Canada and the United States, we think that’s a positive opportunity for us to continue to tell the Americans and obviously Canadians as well, the importance of working together and how both countries are stronger and more secure when we respect and honour a comprehensive free trade agreement,” he instructed reporters.
However few are beneath any phantasm that the problem is identical.
Trump, surrounded by a extra hawkish group of advisers, returned to workplace with a transparent blueprint that was instantly posted on a remade White Home web site, as the president declared a sequence of nationwide emergencies to deploy troopers to the Mexican border, ramp up oil drilling, finish electrical car mandates, and to launch his commerce assessment.
“Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens,” Trump stated.
Canadians from coast-to-coast are bracing for the potential for tariffs and extra antics from a second Trump presidency. (Jan. 20, 2025 / The Canadian Press)
Premier Doug Ford and Alberta Premier Danielle Smith had warned that uncertainty stays, with Smith saying “despite the promising news today, the threat of U.S. tariffs is still very real.”
Smith urged Canadian federal and provincial leaders to cease speaking about “retaliatory measures including export tariffs or cutting off energy to the U.S.” and as an alternative allay Trump’s issues by way of tighter border safety, extra defence spending, more durable immigration insurance policies, and the repeal of “anti-energy” insurance policies.
Ford steered he’d want a brand new electoral mandate to navigate the unknowns forward.
“I’m not saying that we won and it’s over,” stated Quebec Premier François Legault.
In an official assertion, Trudeau congratulated Trump on starting his second time period, and reminded him that “Canada and the United States have the world’s most successful economic partnership.”
“We are each other’s largest trade partners, with a relationship that creates millions of jobs, attracts billions in investment into the continent, and keeps our people safe,” he stated.
Trudeau and successive cupboard ministers argued it’s a “mutually beneficial relationship,” and reminded Trump that the federal government has made “massive investments” to bolster cross-border commerce, reinforce provide chains, and “create jobs on both sides of the border.”
Ottawa has marshalled reams of statistics to show the stakes are excessive, saying eight million jobs within the U.S. are tied to commerce with Canada, with about 70 per cent of Canadian items exported to america used within the manufacturing of different items.
And it says that if Canadian vitality exports to the U.S. are excluded from the equation, the U.S. has had a merchandise commerce surplus since 2007, standing at US $28.6 billion in 2023.
Commerce is just one of Canada’s issues. The doable inflow of individuals fleeing deportation orders is one other.
Immigration Minister Marc Miller instructed the Star that for now, Trump’s focus is on his nation’s southern border “but it would be naive not to expect an uptick here” in border crossings on account of Trump’s deportation orders.
“It’s really cold so it’s more dangerous than normal,” Miller stated, “but be that as it may, if people turn up at the (northern) border they’ll be turned away as per the Safe Third Country Agreement.”
In Washington, Trump stated he would reverse the Biden administration’s “green New Deal” insurance policies, which included not simply EV mandates however billions of {dollars} in tax credit to assist electrical car manufacturing, so as to save “our auto industry and keeping my sacred pledge to our great American autoworkers.”
Business Minister François-Philippe Champagne attended the inauguration on the U.S. Capitol Constructing, watching the ceremony from an overflow room amongst a variety of Republican state governors. In an interview on CBC, he downplayed the fallout of any finish to EV mandates, noting certainly one of Trump’s greatest monetary supporters, Elon Musk, sells EVs and the business will proceed to draw funding because the world seeks to decarbonize.
Canada’s personal subsidies of EV firms have been tied to the existence of American subsidies, and if the U.S. ditches its tax credit, Ottawa has beforehand stated it will, too.
Canadian officers first realized Trump wouldn’t impose tariffs on day one when the Wall Avenue Journal broke the story Monday morning, forward of the inauguration, that Trump would as an alternative signal a memo ordering a commerce deficit assessment which would come with a research of the North American Free Commerce pact.
The newspaper stated it singles out China, Canada and Mexico for scrutiny, directing companies to evaluate Beijing’s compliance with its 2020 commerce cope with the U.S., in addition to the standing of the Canada-U.S.-Mexico-Settlement (CUSMA), the up to date model of the North American Free Commerce Settlement, which is about for assessment in 2026.
One senior federal official stated Trump’s motion might symbolize a severe risk down the highway.
Trump additionally introduced the U.S. withdrawal from the Paris Accord on local weather change, the identical settlement he pulled out of throughout his first administration.
Surroundings Minister Steven Guilbeault stated America’s withdrawal is disappointing, however particular person U.S. states are engaged within the struggle and that received’t change.
“The fact that the federal government in the U.S. will no longer be interested in fighting climate change doesn’t mean that the United States of America, as a whole, is not interested in that, and the international community will continue moving forward, with or without President Trump,” he stated.
Guilbeault added that the president’s timing is “quite ironic … as California is going through one of the worst forest fire seasons in its history.”
Since November, Trump has threatened 25 per cent tariffs on imports from Canada and Mexico, and an extra 10 per cent tariffs on China. That was a big escalation of his election marketing campaign vow of 10 per cent international tariffs on all imports.
Now it’s a wait-and-lobby-harder sport for Canadian political and enterprise leaders.
The Canadian authorities had deliberate a sequence of escalating reciprocal tariffs on American merchandise if Trump moved forward as early as Monday.
Ottawa can be taking a look at methods to assist Canadian companies and employees if an all-out commerce struggle erupts.
It might take weeks and months for the tariff dispute to play out — if Trump does in truth transfer to impose them.
With information from Ryan Tumilty and Raisa Patel
