In a significant escalation of trade tensions, Canada unveiled on Sunday a list of U.S. goods valued at C$30 billion that will face a 25 percent tariff. This move marks the first phase of Canada's retaliation against U.S. President Donald Trump's matching tariffs on Canadian imports.
The initial round of tariffs targets a wide range of American products, including orange juice, peanut butter, wine, coffee, appliances, cosmetics, and paper products. Canadian Finance Minister Dominic LeBlanc announced that these tariffs will take effect on February 4, coinciding with the implementation of U.S. tariffs on Canadian goods.
Beyond this initial list, Canada plans to impose tariffs on a second set of U.S. imports worth C$125 billion. This expanded list, expected to be released in the coming days, will encompass passenger cars, trucks, buses, steel and aluminum products, select fruits and vegetables, aerospace products, beef, pork, and dairy items. A 21-day public consultation period will precede the enforcement of tariffs on these additional goods.
The retaliatory measures follow Canadian Prime Minister Justin Trudeau's vow to respond to the U.S. tariffs, which include a 25 percent levy on most Canadian products and a 10 percent tariff on Canadian energy products starting February 4. Trudeau indicated that Canada is also considering non-tariff trade actions, such as restricting exports of critical minerals and energy products to the United States and barring U.S. companies from bidding on Canadian government contracts.
The Canadian Chamber of Commerce has warned of the economic repercussions of a full-scale trade war. They estimate that the imposition of 25 percent tariffs and comprehensive retaliation could lead to a 2.6 percent decline in Canada's real GDP, costing an average of C$1,900 per household annually. In the United States, real GDP could decrease by 1.6 percent, resulting in an average loss of $1,300 per household.
This escalating trade dispute between two of the world's largest economies has raised concerns among global investors, business professionals, and policymakers. The potential impact on supply chains, commodity prices, and international trade relations is significant, prompting discussions on the broader implications for the global economy.
Reference(s):
cgtn.com
