The Decibel The U.S.–Canada trade war, explained
Feb 3, 2025
Joining the conversation is Jason Kirby, a seasoned reporter for The Globe and Mail specializing in business analysis. He delves into the escalating U.S.–Canada trade conflict, highlighting the impact of tariffs and the retaliatory measures from Canada. Kirby explains how these economic tensions could push Canada toward recession, focusing on sectors like auto manufacturing. He also discusses consumer behavior and how Canadians are rallying to support local products amidst the crisis.
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American Tariffs Explained
- US tariffs are 25% on all Canadian imports, except energy, which will be 10%.
- This is possible due to a declared national emergency related to fentanyl and illegal immigration.
Mechanics of Tariffs
- Tariffs function similarly to taxes, paid by the consumer purchasing imported goods.
- This increases the final price for American consumers.
Canadian Response
- Canada retaliated with 25% tariffs on $155 billion of US goods.
- Initial tariffs target $30 billion worth of goods like fruits, meat, and toilet paper, with more to follow.