Orange juice from Florida. Whiskey from Tennessee. Kentucky peanut butter.
Canada is preparing for an all-out trade war with one of its closest allies and its top The list of trading partners and U.S. products that could be affected is long.
Canadian authorities are preparing a three-stage plan of retaliatory tariffs and other trade restrictions against the United States. It would be triggered if President-elect Donald J. Trump follows through on his threat to impose a flat 25% tariff across Canada. Goods imported into the United States.
Canadian officials plan to wait until Trump takes action (which he has said will be Monday, his first day in office) and then begin imposing tariffs. Two government officials with knowledge of the plan said the impact would primarily be on C$37 billion ($25.6 billion) worth of consumer goods.
They spoke on condition of anonymity to discuss details of the plan, which will remain private for now.
Goal: Maximize political pain
Canadian officials said the selection of products was precisely targeted and aimed at political influence. They especially want to focus on products made in Republican and battleground states, where the pain of tariffs could affect Trump's allies, including pressure on jobs and pressure on local business profits. There is sex.
The Canadian government is hoping its allies, including governors and MPs, will pick up the phone and call Trump and intervene to de-escalate tensions.
Canadian Foreign Minister Melanie Joly, who spent Thursday and Friday in Washington, spoke to her country's advocates, including Sen. Lindsey Graham of South Carolina, Sen. Jim Risch of Idaho, and Senate Majority Leader John Thune. He met with numerous Republican politicians to make his case. South Dakota.
Jolie said she hopes her lobbying of Republican leaders will persuade them to intervene to avoid or limit the trade war and its negative impact on consumers and jobs on both sides of the border. Ta.
“My job here is to be able to talk about the facts, and that takes precedence over the threat of counter-tariffs from our country,” Jolie said in an interview with the Times on Thursday. “Because then senators might say, 'So why are we doing this?'” Why would we impose tariffs?It's affecting my district, too. ”
But he added that Canada stands ready to vigorously defend its interests if necessary. “Never underestimate Canadians,” she said. “We are fighting very hard and being very courageous. We are going to do the right surgery to impact American jobs.”
Prime Minister Justin Trudeau and his cabinet will huddle together Monday and Tuesday in what some are calling “America's war room” in preparation for Trump's first day in office and the possibilities it poses for Canada. We will respond promptly when US tariffs are announced.
The detailed list of products is kept a closely guarded secret, but the list includes dozens of consumer goods in various categories such as food and beverages, as well as other products such as dishwashers and porcelain products such as bathtubs and toilets. It also includes various daily necessities.
Depending on what Canadian products Mr. Trump chooses to impose tariffs on and the level of those tariffs, Canada's second move could extend its own tariffs to more U.S. products and increase the This would impact CAD 1 billion worth of imports from the United States.
As part of its strategy, the Canadian government is also considering other measures to limit Canadian exports to the United States, such as export quotas and U.S.-imposed tariffs. This type of action would be limited to particularly sensitive Canadian exports that the United States depends on, such as Quebec's hydroelectric power, which is used to provide energy throughout New England.
Tariffs are like taxes on goods and are usually passed on to consumers. They make imported goods more expensive, which often means consumers won't buy them, and ultimately hurt foreign companies that export the imported goods.
Trade restrictions, such as export quotas, are intended to limit the availability of goods to be exported and are particularly effective when the importing country does not have easy access to or sufficient alternative sources for the goods. .
Return from the brink
No matter how Canada's counter-tariffs and export controls develop, the objective will be the same. It's about putting pressure on the Trump administration to back away from the president-elect's promise to wage a devastating trade war against America's neighbors.
The trade relationship between the two countries is huge, with nearly $1 trillion of goods exchanged each year. Canada's oil prices fluctuate with Mexico, the U.S.'s largest trading partner.
Because some cross-border industries are highly integrated, tariffs will suddenly become a major regulatory headache for many companies. For example, a single vehicle crosses the U.S.-Canada border up to eight times before it is fully assembled. The tariffs would immediately disrupt car assembly lines in Ontario, the center of the U.S. and Canadian auto industry.
and Canada exports important goods To the United States. About 80 per cent of Canada's oil and 60 per cent of its natural gas are exported to the United States. More than half of the oil imported into the United States comes from Canada.
The third and final level of escalation if the trade war between the United States and Canada escalates would restrict exports of hundreds of billions of dollars worth of sensitive goods, including oil and gas, potash, uranium, and heavy metals. Therefore, the Canadian government wants to avoid this. mineral. Both are important export products for the United States.
Alberta, Canada's largest oil exporter, said it would not support policies that affect its key industry. The rift between Canada's leadership and the rest of the country could deepen further if Canada decides it must use oil as leverage against the United States.
Canada's plans for a potentially protracted U.S. trade war also include support for domestic industry, a senior official said.
The official said the government is preparing for potential financial relief for Canadian businesses hit hard by U.S. tariffs, possibly on a case-by-case basis.
The official said that while large-scale bailouts and blanket industry-wide funding may not be on the table, the tariff war with the U.S. will likely result in a number of He said it was unthinkable to eliminate 1,000 jobs and businesses.
