The Indicator from Planet Money Canada's key resource against Trump's potential trade war
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Jan 30, 2025 
Paul Haverschrud, a business reporter and host of CBC's Cost of Living, dives into the crucial role of Canadian oil amidst potential tariffs from President Trump. He explains how oil could serve as a vital leverage point for Canada in a trade war, highlighting its significance while emphasizing a cautious approach. Haverschrud explores the interconnectedness of Canada and the U.S. economies, sharing insights on past tariffs, the importance of exports, and possible Canadian countermeasures in facing economic uncertainty.
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Canadian Economic Vulnerability
- Trump's tariff threat could severely impact the Canadian economy due to its heavy reliance on exports to the US.
- Exports comprise almost a third of Canada's economy, making them vulnerable to US trade actions.
USMCA and Tariff Threats
- Despite the USMCA trade agreement, Trump's potential tariffs raise concerns about the deal's effectiveness.
- Trump might exploit loopholes or invoke national security concerns, similar to the 2018 steel and aluminum tariffs.
Canadian Retaliatory Measures
- Canada is considering retaliatory tariffs targeting US goods like Florida oranges and Kentucky bourbon.
- This tit-for-tat approach is a likely response if the US imposes tariffs, although trade wars are undesirable.