Trump tariffs against Canada expected

U.S. President Donald Trump plans to impose a 25% tariff on Canadian goods by today.

The proposed tariffs are part of his broader strategy to exert greater influence over Canada, citing economic ambitions and national security concerns driven by evolving geopolitical and environmental challenges, particularly in the Arctic. While Trump’s rhetoric about annexing Canada as the 51st state is unlikely to materialize, his underlying objective appears to be the removal of economic and financial barriers, allowing the U.S. to extend its influence and control over Canadian affairs.

Canada’s economic landscape has undergone significant changes over the past few decades, with deindustrialization leading to its reliance on natural resource exports and agriculture, while much of its remaining high-tech industries are dominated by U.S. capital. The country’s fragmented provincial dynamics, exemplified by Alberta’s recent dissent against Ottawa’s “Team Canada” approach, further complicate its ability to mount an effective economic response to U.S. tariffs. 

In the short term, the imposition of tariffs appears highly likely, which could result in a sharp depreciation of the Canadian dollar—potentially dropping by 10% or more for every 25% tariff imposed. In the medium to long term, without a strategic and flexible response, Canada risks losing significant economic sovereignty to the U.S.