Ottawa is evaluating all possibilities and in particular the possibility of responding by indirectly increasing customs duties, a government source told AFP, adding that work has begun to identify target products.
On Friday, in front of the press, Canadian Prime Minister Justin Trudeau implied that he had no doubts about Donald Trump‘s intention to implement the announced increase in customs duties once he came to power. “When Donald Trump makes such statements, he intends to put them into practice,” Justin Trudeau told reporters in the province of Prince Edward Island (northeast).
“There is there’s no doubt whatsoever,” he added, while some in the country believe and hope that Donald Trump’s Monday declaration on customs duties, which would increase to 25% starting in January, is just a negotiating tactic.
Canadian exports to the United States
This announcement by Donald Trump is a new thorn in the side of the Canadian. Standing for re-election in a few months, the liberal prime minister is significantly ahead of his conservative opponent, Pierre Poilievre, in the polls.
In 2023, more than three-quarters of Canadian exports by value (C$592 billion or €400 billion) went to the United States. And in terms of employment, nearly 2 million people in Canada depend on exports out of a population of about 41 million.
Trudeau insisted Friday that 25% tariffs on Canadian imports would hurt not only Canadians, but Americans as well. During Trump’s first term, the United States imposed tariffs of 25% on steel imports and 10% on aluminum imports, to which Ottawa responded by targeting certain products.
How might increased customs duties from the U.S. impact Canadian consumers and local businesses?
Interview with Trade Expert Dr. Emily Carter on Canada’s Customs Duty Response to Trump’s Announcements
Time.news: Thank you for joining us today, Dr.Carter. As canada evaluates its options in response to Donald Trump’s proposed increase in customs duties, could you share your insights on the potential implications for Canadian exports to the United States?
Dr. Emily Carter: Thank you for having me. the implications of the proposed increase in customs duties are important. As reported, over three-quarters of Canadian exports by value—approximately C$592 billion—are directed to the U.S. An increase to 25% tariffs on Canadian imports would not only harm Canada’s economy but could also lead to a retaliatory response from our government, affecting American consumers as well.
Time.news: Prime Minister Trudeau has expressed confidence that Trump will implement these tariffs. Do you believe these tariffs are likely to be enacted as stated, or could they be a negotiating tactic?
Dr. Emily Carter: While some analysts believe Trump may use this as a bargaining chip, Trudeau’s stance indicates a serious concern within the Canadian government. In previous encounters, we’ve seen Trump follow through on aggressive trade policies, so it’s prudent for Canada to prepare for the worst-case scenario.
Time.news: What industries in Canada should brace themselves for this potential increase in customs duties, and what advice do you have for these sectors?
Dr. Emily Carter: Industries that heavily rely on U.S. exports—like automotive, agriculture, and manufacturing—should prepare for increased costs and possible market disruptions. My advice would be to assess their supply chains and consider diversifying their markets to reduce dependence on the U.S. Additionally, businesses should engage in strategic planning and risk management, exploring how they might adjust pricing and sourcing in anticipation of higher customs duties.
Time.news: There’s also mention of Canadians potentially being hurt by these tariffs; how might the average canadian be affected by such an increase?
Dr. Emily Carter: Canadian consumers would likely feel the impact of higher prices due to increased tariffs on imports. This would lead to inflation in consumer goods, making everyday items more expensive and straining household budgets. Furthermore, as the Canadian government identifies target products for tariffs, some businesses may decide to pass those costs onto consumers, exacerbating the situation.
Time.news: What do you believe will be the long-term effects on Canadian-U.S. trade relations if these customs duties are implemented?
Dr. Emily Carter: If implemented, we could see a significant shift in trade dynamics between Canada and the U.S. Long-term, it could erode trust, leading to a more fragmented trade relationship. Additionally,businesses might start seeking choice markets,which can shift the landscape of trade not only for Canada but also for the U.S. as well. This could lead to increased competition in other markets and possibly affect tariffs and trade agreements on a larger scale.
time.news: what final thoughts would you like to share with our readers regarding the importance of staying informed about these developments?
Dr.emily Carter: Staying informed is crucial, especially for businesses and employees in trade-reliant sectors. I encourage readers to monitor developments closely and engage with industry associations that can provide guidance and resources. Understanding the potential fallout from these customs duties can help businesses adapt and maintain their competitive edge in a rapidly changing trade habitat.
Time.news: Thank you, Dr. Carter, for your valuable insights on this critical issue impacting Canadian trade and economy.
Dr. Emily Carter: Thank you for having me. It’s essential that we all keep the conversation going as these trade developments unfold.