TORONTO (AP) — Canada’s foreign minister warned Americans they will be paying a “Trump tariff tax” if President-elect Donald Trump follows through with a threat to impose a 25% tariff on all Canadian goods.
Foreign Minister Mélanie Joly said Friday that Canada is ready to retaliate and put maximum pressure on the United States.
“If we need to retaliate we will do so. And Americans will discover Trump’s tariff tax,” Joly said after meeting with U.S. senators in Washington.
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Trump has threatened to impose sweeping 25% tariffs on Canada as well as on Mexico. He’s also threatened tariffs on China and Europe, creating a sense of uncertainty about whether this is simply a negotiating ploy or a massive restructuring of U.S. foreign relations.
Trump and his team in recent days have doubled down on his promise to impose tariffs on other nations and downplayed the risk of higher inflation. “Americans are just waking up to this possibility,” Joly said.
Joly said Canada will impose an initial round of retaliatory measures followed by further rounds if Trump goes ahead with it.
“We are well organized and I’d even dare to say we are even better organized than the Americans,” Joly said.
By targeting America’s second largest trading partner after Mexico, Trump risks upending the markets for autos, lumber and oil — all of which could carry over quickly to consumers.
Despite Trump’s claim that the U.S. doesn’t need Canada, a quarter of the oil America consumes per day is from Canada.
Joly met with U.S. Sens. Lindsey Graham, James Risch, Jeanne Shaheen and John Thune as well as outgoing U.S. Secretary of State Antony Blinken on Thursday.
“American senators are saying to themselves, ‘We don’t want this,’” Joly said. “When I mentioned the impact on Americans they are not only surprised but they are very worried.”
Joly said Americans are not really aware of how essential Canada is with respect to foreign trade.
Canada is the top export destination for 36 U.S. states. Nearly $3.6 billion Canadian (US $2.7 billion) worth of goods and services cross the border each day.
Canada is looking at putting retaliatory tariffs on American orange juice, toilets and some steel products if Trump follows through with his threat. When Trump imposed higher tariffs during his first term in office, Canada announced billions of dollars in new duties in 2018 against the U.S. in a tit-for-tat response to new taxes on Canadian steel and aluminum.
Yogurt imports from Wisconsin and whiskey from Kentucky, the home states of top Republicans Paul Ryan and Mitch McConnell, respectively, were hit with 10% duties in 2018.
Former finance minister Chrystia Freeland, who said Friday she is running to be the next prime minister, released an opinion piece in which she said the retaliation must be painful.
“Florida orange growers, Michigan dishwasher manufacturers and Wisconsin dairy farmers: brace yourselves. Canada is America’s largest export market — bigger than China, Japan, the U.K., and France combined. If pushed, our response will be the single largest trade blow the U.S. economy has ever endured,” Freeland wrote in the Toronto Star.
