Canadian Prime Minister Justin Trudeau warned that any tariffs or trade barriers imposed by the U.S. on Canadian goods could harm American workers.
What Happened: During a press conference in Vancouver on Friday, Trudeau highlighted the deep-seated interconnectedness of the supply chains between the US and Canada. He asserted that any increase in border restrictions or imposition of tariffs would “inevitably hurt” American jobs and workers, given Canada’s reliability as a trade partner, reported Bloomberg.
Trudeau’s comments were directed at President-elect Donald Trump, who has proposed a minimum 10% tariff on all U.S. imports, with no exemptions for Canada. Economists at Desjardins estimate that this policy could lead to a 1.7% reduction in Canada’s real GDP by the end of 2028.
Trump has expressed his intention to implement a “pro-American trade policy that uses tariffs to encourage production here and bring trillions and trillions of dollars back home.”
Trudeau reiterated Canada’s alignment with the U.S. in addressing “overcapacity” from China, proposing 100% tariffs on electric vehicles from China and 25% tariffs on steel and aluminum.
"There's an awful lot Canada and the US are going to be able to do together to successfully compete with the world," the Canadian PM said.
Why It Matters: The warning from Trudeau comes in the wake of Trump’s victory in the U.S. presidential election. Analysts have suggested that Trump’s return to the White House could lead to a shift in the commodity market, with a potential impact on the steel industry. Trump’s history of deregulation and tariff-heavy policies could result in greater domestic support for the U.S. steel industry, according to analysts at JPMorgan Chase & Co.
Trump’s proposed tariffs have also raised concerns about their potential impact on American consumers. A study by the National Retail Federation (NRF) warned that the proposed tariffs could significantly impact American consumers, potentially reducing annual spending by $78 billion.
Trump’s specific plans concerning tariffs and taxes have been unclear and have varied greatly. The 2024 Republican Party platform calls for “baseline Tariffs on Foreign-made goods.” According to the Tax Policy Center, Trump most often promotes a 10% worldwide tariff and a 60% tax on imported Chinese goods.
Read Next: Jim Cramer Calls Trump’s Return To White House A ‘Huge Win For The Stock Market’
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