Trudeau vows firm response as business leaders warn of rising costs
The Canadian government retaliated swiftly after US president Donald Trump imposed sweeping tariffs on nearly all imports from Canada, triggering economic uncertainty and straining one of the world’s largest trading relationships.
Prime Minister Justin Trudeau announced Canada will respond with 25% counter-tariffs on CAD$155 billion (UDS$107 billion) worth of US goods, starting with an initial phase targeting CAD$30 billion in American exports, including consumer products like orange juice, peanut butter, coffee, and cosmetics. A broader list, covering automobiles, steel, aluminium, and beef, is set to follow in February after a consultation period.
Speaking from Parliament Hill in Ottawa, Trudeau condemned the tariffs as a reckless and unjustified attack on Canada’s economy. He directly addressed Americans, emphasizing the long-standing military and economic ties between the two countries.
“Yes, we’ve had our differences in the past, but we’ve always found a way to get past them. As I’ve said before, if President Trump wants to usher in a new golden age for the United States, the better path is to partner with Canada, not to punish us,” Trudeau said.
Trump’s justification
Trump invoked emergency powers to justify the tariffs, citing Canada’s alleged failure to curb fentanyl production and cross-border drug trafficking. His move bypasses standard trade procedures outlined in the US-Mexico-Canada Agreement (USMCA), a deal Trump previously hailed as a "colossal victory."
Additionally, Trump’s executive order includes provisions for escalating tariffs further if Canada retaliates, though Trudeau made it clear that while his government was not looking to escalate the situation, Canada would not back down and respond in a “measured but forceful” way.
‘Complete betrayal’
The tariffs sparked immediate backlash from business leaders and provincial governments, with some rolling out their own countermeasures.
British Columbia Premier David Eby ordered the province’s liquor distributor to remove alcohol brands from Republican-led states and introduced a Canada-first policy for government procurement.
“President Trump’s 25% tariffs are a complete betrayal of the historic bond between our countries and a declaration of economic war against a trusted ally,” Eby said.
Meanwhile, Quebec Premier François Legault is reviewing provincial contracts to penalize US suppliers.
Ontario Premier Doug Ford also warned the tariffs will devastate the province’s auto sector, which is deeply intertwined with US manufacturers.
“Trump’s tariffs will devastate our economy,” said Doug Ford, leader of Ontario, Canada’s most populous province and the home to an automotive industry that’s tightly integrated with the US and Mexico.
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Industry groups warned the tariffs will increase prices, disrupt supply chains, and cause job losses on both sides of the border.
The Canadian Chamber of Commerce called the move "profoundly disturbing," warning it will drive up the cost of living.
Linda Hasenfratz, executive chair of auto parts giant Linamar Corp., said US tariffs will cripple North America’s auto industry, leading to layoffs and production shutdowns.
"I just don’t think they can sustain production, which in turn has a pretty immediate impact on our production levels," she warned.
Alberta Premier Danielle Smith claimed partial credit for the lower 10% tariff on energy exports, noting she had pushed against Canada imposing retaliatory levies on oil and gas.
“What is extremely important for me, and I think for all the premiers, is that no one region of the country or one industry carries a larger burden than anyone else,” Trudeau said. “We will not be moving forward on issues that further divide the country, which is why we’re working with all premiers to look at different ways we can encourage the Americans to step back from these trade actions.”
Opposition calls for harder stance
Conservative Party leader Pierre Poilievre, currently leading Trudeau’s Liberals in the polls, urged a “Canada First” approach, echoing Trump’s America First rhetoric.
He proposed using tariff revenues to support affected workers and businesses, cut taxes, and expand trade and energy infrastructure to reduce Canada’s reliance on US markets.
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As tensions escalate, Canada is exploring additional measures, including restrictions on critical minerals exports—a resource vital to US industries. Trudeau also urged Canadians to buy locally made goods and avoid US vacations.
With the first round of retaliatory tariffs taking effect Tuesday, the full impact of the trade conflict remains uncertain.
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