Canada has taken a significant step in trade relations by imposing a 25% tariff on U.S. goods valued at C$30 billion. This move marks the first phase of Canada's retaliation against U.S. President Donald Trump's recent announcement of matching tariffs on Canadian imports.
The tariffs, set to take effect on February 4, will affect a wide range of products, including orange juice, peanut butter, wine, coffee, appliances, cosmetics, and paper products. Canadian Finance Minister Dominic LeBlanc stated that this measure is a direct response to the U.S.'s similar actions, aiming to protect Canadian industries.
Furthermore, Canada plans to expand its retaliatory measures by imposing tariffs on a second set of U.S. imports valued at C$125 billion. This upcoming list will include passenger cars, trucks, buses, steel and aluminum products, select fruits and vegetables, aerospace products, beef, pork, and dairy items. Before these additional tariffs are enforced, there will be a 21-day public consultation period, allowing stakeholders to provide input.
The latest development follows Canadian Prime Minister Justin Trudeau's assertion of retaliation following Trump's declaration of 25% tariffs on most Canadian products and 10% on Canadian energy products. Trudeau also hinted at further non-tariff trade actions, such as restricting exports of critical minerals and energy products to the United States and preventing U.S. companies from bidding on Canadian government contracts.
The Canadian Chamber of Commerce has cautioned that these tariffs could have significant economic repercussions. A 25% tariff and full retaliation may lead to a 2.6% decline in Canada's real GDP, equating to an average cost of 1,900 Canadian dollars per household each year. In the United States, GDP could decrease by 1.6%, costing an average of $1,300 per household.
This ongoing trade dispute highlights the fragile nature of international trade relations and the potential for significant economic impacts on both countries' economies.
Reference(s):
cgtn.com
