All eyes are on Washington after U.S. President Donald Trump triggered a North American trade war against Canada and Mexico.
A day after slapping a sweeping 25 per cent tariff on Canadian and Mexican goods, Trump may announce a deal on Wednesday with the two countries and meet them “in the middle,” U.S. Commerce Secretary Howard Lutnick said on Tuesday.
“Both the Mexicans and the Canadians were on the phone with me all day today trying to show that they’ll do better, and the president is listening because he’s very, very fair and very reasonable,” Lutnick said in an interview with Fox News on Tuesday.
“So I think he’s going to work something out with them.
“It’s not going to be a pause. None of that pause stuff. But I think he’s going to figure out, ‘You do more, and I’ll meet you in the middle someway,’ and we’re going to probably be announcing that tomorrow.”
In response to the U.S. tariffs, Canada is imposing an immediate 25 per cent tariff on $30 billion worth of U.S. goods, with additional tariffs on another $125 billion in American goods to follow three weeks later.
Prime Minister Justin Trudeau met with premiers virtually on Tuesday to discuss the “unjustified” tariffs and Canada’s response, according to a readout from his office.
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“The Prime Minister and the premiers denounced the U.S.’ decision to impose unjustified tariffs and committed to stand united against this economic threat,” the readout said.
“They underscored that tariffs would weaken both of our countries, put thousands of good-paying jobs at risk, and make life less affordable for both Canadians and Americans alike.”
Canadian provinces have swiftly responded to the U.S. tariffs, announcing a range of retaliatory measures on Tuesday.
According to the PMO, Ottawa will soon announce an initial support package to reduce the impact of U.S. tariffs on Canadian workers, families and businesses.
“First Ministers also discussed progress to reduce barriers to internal trade and labour mobility within Canada,” the readout said.
Meanwhile, business groups in Canada are concerned about the impact of the trade war and economists are warning that the Canadian economy is poised to plunge into a recession this year if the U.S. tariffs remain in place.
“No one wins in a trade war and the tariffs imposed today by the Trump Administration will hurt workers, farmers and families across North America — especially those in the United States,” Goldy Hyder, president and CEO of the Business Council of Canada, said in a statement Tuesday.
The U.S. move has angered many Canadians, with “elbows up” becoming a rallying cry online and on the streets.
Tariff tensions have also given rise to a “buy Canadian” movement in recent weeks, with consumers ditching U.S. products for local ones and businesses giving more prominence to local options.
— with files from Global News’ Sean Boynton
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