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Analysts warn US-Canada trade war could cost 100,000 Canadian jobs

financeAug 28, 202686382

The United States imposed 50 percent tariffs on 20 billion dollars of Canadian goods after talks collapsed, and President Donald Trump threatened 50 percent levies on all car products starting January 1. Canada responded with retaliatory tariffs on more than 700 U.S. products, also totaling about 20 billion dollars, tiered at 15, 25 and 50 percent and set to take effect on September 8. Canada sends roughly 70 percent of its exports to the United States and its overall economy is about one-tenth the size of the U.S. economy, a dynamic experts say makes Canada especially vulnerable to U.S. penalties. Oxford Economics estimates the U.S. tariffs will shave 0.3 percentage points off Canadian GDP next year, while consultancy Peacock Tariff Consulting warned the dispute could cost upwards of 100,000 Canadian jobs. Analysts say manufacturers in Quebec, New Brunswick and Ontario and exporters in British Columbia will be hit hardest because they produce easily substituted goods such as cement, paper, wood, beverages, clothing, plastics and electronics. Some Canadian firms are already planning factory closures and layoffs if tariffs remain, and diplomatic tensions have escalated with symbolic actions such as the U.S. renaming Lake Ontario.

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