While Ottawa raises possible solutions to US President Donald Trump’s threats about customs duties, it faces a dilemma: Will the United States satisfy and open the local market, which leads to volatility and loss of jobs, but it is likely to lead to low consumer prices, or will they stand firmly with revenge sanctions? Threats to protect Canadian industries?
Canada is preparing for the effect of Trump’s threats to impose a 25 percent comprehensive customs duties on all goods that enter the United States from Canada and Mexico, with a lot said about the high prices of some consumer goods if the definitions enter into force, but only little attention has been paid to what Be possible solutions, such as opening the market.
“I will not exaggerate it, there will be a loss of jobs if we open those protected industries,” says Ian Lee, Assistant Professor at Sprote College of Business Administration at the University of Carlton.
“But prices will decrease, and will not rise, and companies can continue to achieve much more success [in an open market]”.
At the heart of this commercial battle there is a list of long -term American grievances. The giant company in the south of the border wants to reach the Canadian markets for all types of goods and services, specifically communications and banking services. This can have positive results for Canadians in terms of purchasing power – but if Ottawa does not meet with Trump at the negotiating table, the repercussions of mutual trade may be much more destroyed.
“We cannot enter into a commercial war. He tells me:” If we do so, we will be slaughtered. “
Trump is known for its long -term beef Protection industries in Canada Especially the supply management, which protects dairy, eggs and poultry industries in the country. But he is not the first American president to clash with Canada on trade. Instead, it may be the most sound on this topic.
“I really don’t really see that Trump raises any specific commercial issues related to Canada that is not widely taken in the United States,” says Mark Warner, a Maaw Law director in Toronto.
“The irritants were always present. Trump is behaving based on it when this did not do that.
The next Trump administration members have described the definitions as a bargaining tool used to attract other countries to the line and to protect American interests. But the United States’ trade war with China in 2018 proves that Trump is not afraid to implement these threats.
This week, the liberal government threatened to respond to Trump’s customs fees on the basis of “the dollar against the dollar”, which may enter into force early on the first of February, but now it seems that it is likely to be applied in April. Canadian Prime Minister Justin Trudeau insists that customs definitions will not only harm Canadian industries, but will also increase the costs on American consumers, especially in sectors such as cars, wood and oil – so revenge should be “strong”.
But experts say that the difference in size between the two countries makes this battle unequal, if not disastrous.
“This is completely ridiculous … No country can stand in the face of this force against this tyrant,” tells me. “Our strategic goal is to cancel all tariffs … not to appear to a group of angry voters that we went and shocked by Donald Trump.” In his face or kicking him in his legs to make us feel better. ”
This is the reason why the “Canada team” approach is divided. While Canadian voters believed with an overwhelming majority that fighting fire with fire is the best option, many provinces, including the heads of Quebec, Saskatchewan and Alberta ministers, rejected the reign of revenge.
Daniel Smith, Prime Minister of Alberta, went to the point of trying to win the friend of Trump through the mission of making peace in Maralago.
Trump continued to tire him during a virtual speech in front of the World Economic Forum in Davos, Switzerland on Thursday, where he criticized many allies but provided a lot of his anger at Canada – saying that he did not need cars, wood or Canadian oil.
He stressed that it is “not fair” that the United States has a commercial deficit with Canada amounting to 200 billion dollars or 250 billion dollars.
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This claim may be wrong – the trade deficit of American goods and services with Canada reached about $ 40.6 billion in 2023, according to the US government’s economic analysis office, mostly due to the import of the United States for Canadian oil, keeping costs at a higher level. He severely presses the Americans – but his laundry list of perceived commercial violations is not.
Supply management “more than dead”
Canada is currently listed in the list of monitoring the commercial representative of the United States (USTR) due to concerns about its enforcement of intellectual property rights, especially with regard to high levels of piracy via the Internet, insufficient border controls against counterfeit goods, and the remarkable lack of strong penalties for violating copyrights . .
But Trump, and the previous American administrations, have a long list of grievances that extend beyond those issues.
The soft wood is one of the sources of disagreement – a bilateral conflict that has lasted for decades – as well as banks and communications monopolies, controversial digital tax tax in Canada, and alcoholic and energy drink industries.
The country’s supplies management system, which protects the country’s dairy, eggs and poultry industries from market fluctuations, has been the United States for a long time, and Trump in particular. The opening of that market was a central point in re -negotiating the North American Free Trade Agreement (NAFTA), which led to some concessions in the North American Free Trade Agreement (CusMA). Trudeau announced billions of compensation for Canadian farmers as a result of that deal.
However, the number of dairy farms has been a long time ago in Canada, due to the progress of technology and production. When the show management was entered in 1972, there was about 145,000 dairy farms in Canada. There are now about 9000.
“The number of Canadians working in the field of dairy is so trivial that it is not even worthy of taking it.”
He says the dismantling of the supply management can also lead to a decrease in local prices, with more options entering the market.
“[Supply management] He is dead from the dead. “
It calls for me to combat customs definitions by opening protected industries to invite competition to the market and reduce prices. While there will be a loss of jobs, American companies will enter the market and establish subsidiary companies, he says, which would create more job opportunities – and therefore there will be more “job disorder”.
He tells me that Canada also needs to go forward in reviewing CUSMA, currently scheduled for 2026, and canceling digital taxes. It also suggests an increase in spending on the army “overnight – I do not mean the promises of the ten years that we were giving to the Americans.”
Canadian businessman Kevin Olieri, who says he visited Trump “several times”, agrees with his home in Maralago and is currently competing with the entrepreneurs of other wealthy people in the United States to buy the American arm of Tik Talk.
Oliri says that he attended a dinner party at Trump’s home where the conversation turned into the possibility of creating an “economic union” between the two countries, with a focus on a passport similar to the European Union to allow freedom of movement and a common currency and eliminate all customs tariffs – and this means that protection is like the management management must Go.
“They will have to abandon this for the economic union … and then they will have a free flow to compete with the cheese and butter they make. They can sell it in California, and they can sell it in Texas, so their market will increase by ten times.
Oliri says it was the one who called on the Prime Minister of Alberta to the Maralago, where she asked to exempt Trump’s threats to customs tariffs – especially for Canadian crude oil, most of which are produced in the oil sand in Alberta.
Smith also preached diplomacy, not revenge, as the way to move forward with Trump.
But this approach is inconsistent with Canadian voters, and with the upcoming general elections, he tells me that many reprisals can be political positions.
A new poll conducted by the Epsus Foundation showed that 82% of the participants agree with the phrase that if Trump targets Canadian goods, Canada must take revenge by imposing customs duties on American imports to Canada.
“A large number of Canadians are crazy than hell. They want a politician to go out there and hit Donald Trump in a metaphorically in the face. He tells me:” But this is something that must be resisted at any cost. “
“It says the calm part loudly.”
Trump has been lengthy in Davos that dealing with Canada “is very difficult over the years.” By doing this, commercial lawyer Warner says: “He says the calm part loudly.”
Warner says that previous departments – including Biden and Obama – have faced difficulties with the “stalled” Canada approach in commercial deals, but they were not “harsh” in her messages.
“It is the way most commercial partners with Canada look at Canada when it is time to sit.
“This is the Canadian way of working. This is exactly what Canada is doing.”
However, Warner said that the justification of this tactic has become more difficult, as China used similar tactics.
Stephen Miran, a former Trump’s senior adviser and candidate for the presidency User guide to restructure the World Trade System – Which has largely talked about the definitions imposed on China, but it can serve as a plan to see Trump 2.0.
In the 40 -page report, Miran is considering reforming the global commercial system on the condition that “access to the US consumer market is a privilege that must be acquired, not really.”
Miran wrote that customs definitions are used as a “negotiating tool” and an effective way to increase taxes on foreigners to pay costs to maintain low tax rates on Americans, and will be implemented in a way that deeply intertwines with national security concerns.
Trump Executive command seeks a commercial policy “America first” It is largely centered on national security concerns.
He tells me that to understand Trump’s thinking behind customs duties, Canada must look at what he called “Trump Trump” – Miran, Huard Lottenic, an executive in Wall Street and Trump’s choice of US Minister of Trade and Square Bessent, an investor and businessman. The director of the hedge fund was appointed to be the Minister of Treasury.
Lootnick is also responsible for the Trump agenda of customs and trade definitions, and he has spoken in the past about the use of customs tariffs as “bargaining card”. In a Discuss the last podcastLootnick described the definitions as one of the main factors of the prosperity of the United States until World War II.
Miran wrote that Pesent proposed the division of states into different groups based on its “currency -related policies, the conditions of bilateral agreements and security agreements, their values and more.” The buckets can bear different introductory rates and countries can “move between buckets” if they achieve commercial goals.
For countries that inevitably wish to take revenge, Miran says that the United States is in a good position that allows them to “win the chicken game.”
