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Americans will pay more: Trudeau reacts to Trump's warning to impose tariffs on Canada from February 1

The war of words has begun between United States and Canada after Trump said he plans to impose 25 per cent tariff on Mexico and Canada. While Trump has said earlier that the US doesn't need Canada, it is important to note that nearly a quarter of the oil America consumes per day comes from Canada.

Donald Trump and Justin Trudeau
Donald Trump and Justin Trudeau Image Source : AP
TorontoPublished: , Updated:

On Thursday, Justin Trudeau, the outgoing Canadian PM, said that if US President Donald Trump decides to move forward with his plans to apply sweeping tariffs on Canadian products, American consumers will pay more. Trump, who threatened to impose sweeping new tariffs on Mexico, Canada, and China, told reporters that he plans to tariff Canada and Mexico at 25% rates starting February 1. Trudeau said Canada would respond with retaliatory measures, imposing tariffs, and "prices for American consumers on just about everything will go up." Trudeau added, "We don't think he (Trump) wants that." 

Does US really not need Canada? 

While Trump claims the US does not need Canada, nearly a quarter of the oil America consumes per day comes from America's second-largest trading partner. If Trump targets Canada, he may risk upending the markets for autos, lumber, and oil, which will have a direct impact on consumers. 

Notably, the US is eager for almost 34 critical minerals and metals that Canada has, while Ottawa is the largest foreign supplier of steel, aluminium and uranium to Washington. 

"The US should be working even more with Canada on our energy, on our critical minerals, and on the goods they need to deliver the economic growth that Donald Trump has promised,” Trudeau said.

Canada is likely to impose 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 US in a tit-for-tat response to new taxes on Canadian steel and aluminium. 

War of words between Trump, Trudeau

"Everything is on the table," Trudeau said. "It would be bad for Canada, but it would also be bad for American consumers," he added. 

The US president told reporters at the White House earlier this week that, in his opinion, the amount of fentanyl coming through Canada and Mexico is “massive."

“We have highlighted that less than one per cent of illegal drugs coming into the United States, less than one per cent of migrants going into the United States come from Canada but we're still investing over a billion dollars and strengthening our border,” Trudeau said.

Nearly USD 2.7 billion, which translates into 3.6 billion Canadian dollars worth of goods and services pass the US-Canada border each day. Notably, Canada is also the top export destination for 36 US states.

Also Read | Give California or Vermont to Canada: Trudeau unveils counter-offer as Trump reiterates 51st state claim

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