TORONTO — Canada is considering imposing retaliatory tariffs on a variety of American products such as orange juice, toilets, and certain steel goods if U.S. President-elect Donald Trump follows through on his plan to implement a 25% tariff on all Canadian exports, according to a senior official with knowledge of the discussions on Thursday.
The official, who requested anonymity due to the confidential nature of the discussions, indicated that the finalized list of products that could face tariffs is not yet complete.
This week, Trump announced his intention to leverage economic pressure to compel Canada to accept a status akin to being the 51st state. His remarks have included a mischaracterization of the trade deficit with Canada as a subsidy, despite Canada’s rich natural resources which significantly contribute to U.S. markets, particularly in commodities including oil.
In response, outgoing Prime Minister Justin Trudeau stated that Trump’s remarks seem designed to divert attention from the serious implications of his proposed tariffs. “President Trump, who is a very skilled negotiator, is leading people to be sidetracked by discussions about statehood,” Trudeau remarked.
He emphasized the potential financial impact on American consumers, warning that if Trump moves forward with the tariffs, everyday products purchased from Canada will see considerable price increases. Trudeau made these comments during an interview in Washington, D.C., following the funeral of late U.S. President Jimmy Carter.
Previously, during Trump’s first term, the U.S. implemented higher tariffs on various imports which prompted countermeasures from other nations, including Canada, who retaliated with billions in new duties on U.S. goods in 2018 after tariffs were placed on Canadian aluminum and steel.
“We would certainly respond as we did in the past,” Trudeau reaffirmed. Products affected previously included 10% tariffs on yogurt from Wisconsin and bourbon from Kentucky, home states of prominent Republican leaders Paul Ryan and Mitch McConnell.
Notably, Florida, which is Trump’s home state, is recognized for its vast citrus production. Trump has stated that the U.S. does not rely on Canadian imports, including automobiles, timber, and dairy products. This claim overlooks the intricate supply chains of the auto industry, where components manufactured in Ontario are essential for vehicles assembled in Detroit that are then sold back to Canada.
Ontario’s Premier Doug Ford highlighted that auto parts frequently cross the Canada-U.S. border multiple times during production. He noted that Trump seems misinformed about the necessity of Canadian products, citing that Canada supplies nearly a quarter of the oil the U.S. consumes each day, exporting approximately 4.3 million barrels daily from Alberta. As per the U.S. Energy Information Administration, the U.S. consumes around 20 million barrels daily while producing about 13.2 million domestically.
Premier Ford cautioned that Canada would retaliate if Trump proceeds with the tariffs, indicating that multiple U.S. exports to Canada would be affected but refraining from detailing specific items.
Canadian officials have conveyed that Trump’s suggestion regarding Canada’s statehood should no longer be seen as a mere joke and instead reflects an effort to weaken relations with America’s closest ally. Dominic LeBlanc, Canada’s finance minister and key figure in U.S.-Canada relations, stated, “The joke is over. It seems a tactic to create confusion, stir people, and generate chaos, fully aware that this will never materialize.”
LeBlanc has engaged with members of Trump’s incoming Cabinet regarding a billion-dollar initiative aimed at enhancing border security as a mitigative step against potential tariff threats. Trudeau characterized that proposal as a strategic gain for Trump.
Importantly, Canada serves as the primary export market for 36 U.S. states, with nearly CAD 3.6 billion (USD 2.7 billion) worth of goods and services transferring across the border daily.
