Outgoing Prime Minister Justin Trudeau criticized Donald Trump’s broad tariffs on Canada, calling the move “a very stupid thing to do” and pledged a “relentless fight” to safeguard the Canadian economy.
President Trump enforced 25% tariffs on goods from Canada and Mexico and increased duties on imports from China.
In response, Trudeau announced retaliatory tariffs on U.S. exports and warned that a trade conflict would harm both nations.
President Trump escalated tensions further in a post on Truth Social, stating, “Please explain to Governor Trudeau, of Canada, that when he puts on a Retaliatory Tariff on the U.S., our Reciprocal Tariff will immediately increase by a like amount!”
Trudeau accused Trump of attempting to “trigger a total collapse of the Canadian economy to make annexation easier.”
“That will never happen. We will never become the 51st state,” Trudeau told reporters Tuesday.
“This is the time to fight back and show that a dispute with Canada ends in losses for everyone.”
Trudeau emphasized that the priority is to lift the tariffs as quickly as possible, so they “last no longer than absolutely necessary.”
Trudeau Dismisses Fentanyl Claims
President Trump defended the tariffs, claiming they would protect American jobs and manufacturing while addressing illegal immigration and drug trafficking. He specifically cited efforts to combat fentanyl and blamed other countries for the drug’s entry into the U.S.
Trudeau dismissed the fentanyl claims on Tuesday, stating there was “no basis” for the tariffs since less than 1% of the fentanyl seized at the U.S. border originates from Canada. However, under Trudeau’s leadership, fentanyl users continue to flow into Canada.
Mexican President Claudia Sheinbaum echoed Trudeau’s stance, calling Trump’s actions unjustified. She pledged to introduce her countermeasures but said more details would follow on Sunday.
John Rogers, an economics professor at American International University, warned that Trump’s tariffs could increase consumer prices in the U.S. and beyond. He highlighted increased costs for food imported from Mexico and oil and gas from Canada as likely immediate effects.
“Prices are expected to rise fairly quickly,” Rogers noted, though he couldn’t predict by how much or how soon. He expressed concern about the strain on America’s key trading relationships.
“This is like poking your neighbour in the eye,” Rogers said. “In a U.S.-Canada-Mexico trade dispute, everyone ends up losing.”
Canada, Mexico, and China are among the U.S.’s biggest trade partners, and these back-and-forth measures have raised fears of a broader trade war. “There’s no winner in a trade war. Everyone loses because prices go up and quality is sacrificed,” added Rogers.
Tariffs, a tax on imported goods, are typically intended to shield domestic businesses from cheaper foreign competition and boost local industries.
Canada’s response includes a 25% tariff on C$155 billion worth of American imports:
- Immediate tariffs on goods valued at C$30 billion
- Tariffs on the remaining C$125 billion will take effect in 21 days
Immigration Minister Marc Miller warned that up to a million Canadian jobs could be at stake due to the deep economic ties between the two countries.
“We can’t overnight replace an economy that accounts for 80% of our trade. This will hurt,” Miller said Monday.
In Ontario, Joel Soleski, an auto manufacturing employee, expressed fears of layoffs. “I just bought my first house,” he said. I might need to find another job.”
The auto industry could face significant disruptions under the new tariffs. Car parts often cross the U.S.-Canada border multiple times during assembly, potentially incurring taxes at each step.
Cutting off Electricity Exports
Ontario Premier Doug Ford, whose province is the heart of Canada’s auto sector, warned that assembly plants on both sides of the border could shut down due to the tariffs.
The Canadian Chamber of Commerce called the tariffs “reckless.” President Candace Laing cautioned that the move could lead to “recession, job losses, and economic disaster” for both nations.
Laing also pointed out that American businesses would face higher costs and need to seek less reliable suppliers outside Canada.
In response, provincial leaders promised to counteract. Ford suggested cutting off electricity exports to the U.S., taxing electricity sent to states like Michigan, New York, and Minnesota, and halting shipments of high-grade nickel.
Canada currently exports enough electricity to power six million U.S. homes.
Provinces like Ontario and Nova Scotia have also removed U.S.-made alcohol from store shelves. Nova Scotia’s Premier Tim Houston and Ontario’s Ford announced bans on U.S. companies bidding for government contracts. Ford also cancelled a C$100 million contract with Elon Musk’s Starlink satellite internet service.
Meanwhile, China, facing a 20% tariff after Trump doubled earlier duties, vowed to fight back. Chinese officials announced their tariffs on various U.S. agricultural and food products.
