Canada has developed a list of $105 billion worth of US goods on which it will impose tariffs if the US President-elect Donald Trump keeps his campaign promise and imposes a 25% tariff on Canadian goods.
Bloomberg reports this, citing sources.
It is not known exactly which products Canada has included in the initial list, but depending on the actions of the US, it could be expanded.
The tariffs could target a broader range of the US goods than during the 2018 trade dispute, when Trump was first president. At the time, Canadaʼs similar list included $16.6 billion worth of the US goods. The U.S. then imposed tariffs on Canadian steel and aluminum, and Canada responded with tariffs on a variety of the US goods, including whiskey and washing machines.
The premiers of 12 of the 13 provinces have agreed to work together on a joint response to potential tariffs. However, Alberta Premier Daniel Smith has rejected the idea of taxing or cutting energy exports to the United States, which accounts for more than half of the US crude oil imports.
Ontario Premier Doug Ford, who leads the province that is the center of Canadaʼs auto industry, called for political unity in the face of Trumpʼs threats.
Canadian Prime Minister Justin Trudeau said that Canada and the United States have opportunities to build an energy partnership because Canada has critical minerals needed to transform the US economy.
"If they donʼt get them from Canada, theyʼll get them from China," Trudeau said.
What preceded
The US President-elect Donald Trump promises to impose tariffs on goods from China, Mexico and Canada on his first day in office.
Bloomberg wrote that Canadian authorities are considering various options for how to respond to the country if Trump follows through on this promise.
A list of nearly every American product that Canada exports from the US is also being circulated among Canadian officials. But it will not be made public until Trumpʼs exact intentions are clear.
Canada wants to act on the principle of “dollar for dollar”. But one of the officials Bloomberg spoke with said that in the worst case, if Trump imposes tariffs on all Canadian exports to the United States, such a scheme will not work. The government of Canadian Prime Minister Justin Trudeau is studying all options to “hurt” American exporters, Bloomberg writes. One of them is to impose tariffs on strategic US goods, including oil, uranium and potassium. At the same time, Canada hopes to avoid a trade war with the United States altogether.
According to calculations by economists at the Bank of Nova Scotia, if the US imposes a 25% tariff, Canadaʼs gross domestic product will fall by 3.8%. And if Canada chooses "full retaliation," that is, imposes taxes on all US goods, these costs will reach 5.6% within a few years.
Canadian officials expect that even if Trump does not go down the path of imposing all tariffs, he will still try to limit Canadian exports in some way. In particular, they are considering the 2018 "scenario".
- Canada is the worldʼs largest national importer of American goods. In the first 11 months of last year, the country imported $320 billion worth of goods from the United States — while the EU bought $341 billion worth of American goods during the same period.
- During Trumpʼs first term as president, the United States and China were embroiled in a trade war. After Trump took office, the countries raised tariffs on each otherʼs imports. Trump accused China of "unfair trade practices" and imposed tariffs on foreign goods, believing that doing so would help American manufacturers.
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