Canada Awaits the Return of Trump's Reciprocal Tariffs

Strategic Insights -

As the 90-day pause on US tariffs comes to an end, Canada remains hopeful that a trade deal with the US can be reached by July 21. However, trade experts and business groups warn that the unorthodox negotiating tactics of President Trump make it impossible to rule out the possibility of Canada being added to the list of countries subject to tariffs. Trump's penchant for unpredictability and his recent moves targeting Japan and South Korea have left Canada on high alert. Despite efforts by Prime Minister Mark Carney and his team to secure a deal, the uncertainty surrounding Trump's actions has left many in the Canadian business community nervous.

Key Takeaways:

  • The 90-day pause on US tariffs is set to expire, but it's unclear whether Canada will be added to the list of countries subject to tariffs.
  • Prime Minister Mark Carney is still aiming for a trade deal with the US by July 21, but trade experts warn that Trump's unpredictability makes it difficult to rule out the possibility of Canada being targeted.
  • Trump has recently imposed 25% tariffs on goods imported from Japan and South Korea, citing persistent trade imbalances with the two countries.
  • The Canadian Chamber of Commerce's Matthew Holmes warned that Canada should not assume it is off the hook, despite not being on the initial list of countries announced by Trump.
  • Trump's unorthodox negotiating tactics, including his use of surprise moves, make it difficult for Canada to predict what will happen next.
  • The Canadian Automotive Parts Manufacturers' Association's Flavio Volpe expressed hope that a deal can be reached by July 21, but noted that "nothing is ever guaranteed."
  • The Canadian Chamber of Commerce's Matthew Holmes warned that the US tariffs on steel, aluminum, and autos are already hammering the Canadian economy.

Statistics:

  • The 90-day pause on US tariffs begun in April will expire on Wednesday, June 16.
  • The Trump administration has imposed tariffs ranging from 10% to 84% on dozens of US trading partners.
  • The US has imposed 25% tariffs on goods imported from Japan and South Korea.
  • Prime Minister Mark Carney aims to secure a trade deal with the US by July 21.
  • The Canadian economy is already being impacted by the US tariffs on steel, aluminum, and autos.

Sources:

  • "As the rest of the world awaits the return of Donald Trump's "reciprocal" tariffs, Canada is out of the line of fire. Probably. At least for now." - www.thestar.com
  • "Canada wasn't on the initial list of countries announced on "Liberation Day" and Prime Minister Mark Carney has said he's still aiming for a trade deal with the U.S. by July 21." - www.thestar.com
  • "The letters warned both countries not to retaliate by increasing their own import taxes, or the Trump administration would further increase tariffs." - www.thestar.com
  • "If for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added onto the 25 per cent that we charge," Trump wrote in the letters to Japanese Prime Minister Shigeru Ishiba and South Korean President Lee Jae-myung. - www.thestar.com
  • "I think there's a risk he could do that. I wouldn't be shocked," said Matthew Holmes, head of public policy at the Canadian Chamber of Commerce. - www.thestar.com
  • "There's nothing to stop him from doing something similar with another issue. That could be dairy, or it could be any other issue," said John Boscariol, head of the international trade law group at McCarthy Tetrault. - www.thestar.com