“Catastrophic”. This was the first word that came to Ian Lee's mind, professor at the Sprott School of Business at Carleton University in Ottawa, when he learned of Donald Trump's intention, revealed Monday, November 25, to impose a 25% tax on products exported from Canada. A few figures allow us to better understand its reaction and the extent of the threat. In 2023, more than three-quarters (77%) of Canadian exports by value (595 billion Canadian dollars, or 403 billion euros) will head to the United States and more than 2.2 million Canadian jobs are dependent on them.
Read also | Article reserved for our subscribers Donald Trump's announcements on customs duties reignite trade tensions
Read later
At the top of these exports are energy products (112 billion euros) then motor vehicles and their spare parts (57.6 billion euros). “ If Trump implements the tax, southern Ontario's auto industries will lose their main export market in one day. There will also be a significant impact on the activity of ports and rail trade. It's almost as if Trump announced a border closure,” analyse M. Lee.
In his report “Partners for prosperity: study of the importance of trade between Canada and the United States”, professor in the economics department of the University of Calgary, Trevor Tombe, anticipated that a tariff tariff of 10% on Canadian exports would reduce production exported to the United States by the Canadian energy and manufacturing sectors by 22%.
Risk-all strategy
In 2026, the three signatory countries of the Canada-United States-Mexico Agreement will have to decide whether they extend the text. But in fact, if Donald Trump's threat is carried out, “the agreement no longer exists, because the United States will no longer respect its terms”observes Nelson Wiseman, professor emeritus of political science at the University of Toronto.
During Trump's first term, the previous trade war between the two countries resulted in tariffs of 25% on steel imports and 10% on aluminum, to which Ottawa responded. But the announced tax is very different, assures Nelson Wiseman: “It’s just a threat!” But the prices he announces affect all sectors. A targeted response is impossible. » Donald Trump makes the lifting of customs tariffs conditional on better control of the Canadian and Mexican borders.
You have 34.17% of this article left to read. The rest is reserved for subscribers.
Related News :