Trump eyes Feb. 1 for new tariffs on Canada
As tensions rise over potential US tariffs on Canadian imports, the Canadian government is drafting a contingency plan aimed at cushioning economic fallout.
Officials indicate that the scale of relief could match pandemic-era measures, but specifics remain undecided and will depend on the severity of the tariffs.
According to a report from BNN Bloomberg, the tariff threat stems from US President Donald Trump’s proposal to impose a 25% levy on imports from Canada and Mexico. Although initially announced in November, the measure was not immediately enacted.
Trump has since ordered a review of trade practices, with findings expected by April 1, and has suggested that tariffs could take effect as early as February 1. White House Press Secretary Karoline Leavitt recently confirmed the timeline, stating, “The February 1 date for Canada and Mexico still holds.”
While Trump initially linked the tariffs to border security concerns, his focus has shifted to advocating for tariffs as a standalone economic strategy. Pressed on whether Canada’s actions have met US expectations, Leavitt avoided specifics but emphasized that the February 1 timeline remains unchanged.
Read more: Tariffs could devastate Canadian manufacturers; Ford says China will be the winner
Canadian Prime Minister Justin Trudeau has acknowledged the potential for economic disruption and pledged government intervention to shield consumers and businesses. At a recent caucus retreat in Montebello, Quebec, Trudeau stressed that federal support would be available to address the impacts of a trade dispute. However, sources suggest that any relief measures would be rolled out incrementally, responding to economic challenges as they arise.
Economic experts warn that a 25% tariff could reduce Canada’s GDP by 2.6% and increase household expenses by C$1,900 annually.
Read more: Canadian economy faces 3.25% hit if US tariffs proceed, warns CIBC
The Canadian Chamber of Commerce has highlighted the potential for job losses and supply chain disruptions. During the COVID-19 pandemic, the federal government implemented an $82 billion relief package, including C$27 billion in direct supports and C$55 billion in tax deferrals and wage subsidies. A similar approach could be on the table if tariffs are imposed.
Parliamentary approval will be required for any aid package, but Canada’s political landscape presents challenges. Parliament is prorogued until March 24, and opposition parties have expressed divergent positions.
New Democratic Party leader Jagmeet Singh has called for bipartisan discussions to safeguard workers but noted that the government has yet to engage with his party.
Bloc Québécois leader Yves-François Blanchet has dismissed the idea of supporting government initiatives, while Conservative Deputy leader Melissa Lantsman criticized the delay in Parliament’s return.
Meanwhile, Foreign Affairs Minister Melanie Joly is in Washington this week, engaging in diplomatic efforts to prevent the tariffs. Joly emphasized the importance of private discussions, expressing optimism about Canada’s arguments but acknowledging that further work is needed.
