Canada is hitting back against U.S. President Donald Trump‘s tariffs with counter-tariffs worth $155 billion.
“Tonight, I am announcing Canada will be responding to the U.S. trade action with 25 per cent tariffs against a $155 billion worth of American goods,” Prime Minister Justin Trudeau said on Saturday in an address to the nation.
Trudeau said this will include immediate tariffs on $30 billion worth of goods as of Tuesday, followed by further tariffs on $125 billion worth of American products in 21 days’ time to “allow Canadian companies and supply chains to seek to find alternatives.”
Speaking to reporters, Trudeau said he has been reaching out to Trump since his inauguration but has not had the chance to speak to the American president yet.
Trudeau said Canada’s response “will be far reaching and include everyday items such as American beer, wine and bourbon, fruits and fruit juices, including orange juice, along with vegetables, perfume, clothing and shoes.”
He said the list of tariffed goods will include major consumer products like household appliances, furniture and sports equipment, and materials like lumber and plastics.
Canada’s response could also include non-tariff measures centered around the supply of critical minerals or energy procurement.
Asking Canadians to stand in solidarity with each other, Trudeau said, “In this moment, we must pull together.”
Trudeau urged Canadians to buy local.
“There are many ways for you to do your part. It might mean checking the labels at the supermarket and picking Canadian-made products. It might mean opting for Canadian rye over Kentucky bourbon, or forgoing Florida orange juice altogether,” he said.
Trudeau added, “It might mean changing your summer vacation plans to stay here in Canada and explore the many national and provincial parks, historical sites and tourist destinations our great country has to offer.”
Speaking in Ottawa, Trudeau also addressed the American people, warning them that Trump’s actions would put their jobs in jeopardy and raise costs south of the border.
He also made an emotional appeal by evoking the Canada-U.S. relationship.
“From the beaches of Normandy to the mountains of the Korean Peninsula, from the fields of Flanders to the streets of Kandahar, we have fought and died alongside you,” he said.
U.S. President Donald Trump signed an executive order imposing tariffs on Canadian and Mexican goods, he said in a statement on Saturday.
“I have implemented a 25% Tariff on Imports from Mexico and Canada (10% on Canadian Energy), and a 10% additional Tariff on China,” Trump said in a statement.
Trump’s executive order states that the tariffs will go into effect at 12:01 am Eastern on Tuesday, Feb. 4.
On Saturday, Trudeau chaired a cabinet meeting and hosted a virtual meeting with the provincial and territorial premiers. He also spoke with Mexican President Claudia Sheinbaum.
Trump said he was imposing tariffs because of “the major threat” of fentanyl crossing into the United States.
“We need to protect Americans, and it is my duty as President to ensure the safety of all. I made a promise on my Campaign to stop the flood of illegal aliens and drugs from pouring across our Borders, and Americans overwhelmingly voted in favor of it,” Trump said in his statement.
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Trudeau reacted in a brief statement on social media.
“The United States has confirmed that it intends to impose 25% tariffs on most Canadian goods, with 10% tariffs on energy, starting February 4. I’ve met with the Premiers and our Cabinet today, and I’ll be speaking with President Sheinbaum of Mexico shortly.”
He added, “We did not want this, but Canada is prepared. I’ll be addressing Canadians later this evening.”
In a social media post in Spanish, Mexican President Claudia Sheinbaum said, “We categorically reject the White House’s slander against the Mexican government of having alliances with criminal organizations, as well as any intention of intervention in our territory.”
She added, “I propose to President Trump that we establish a working group with our best public health and security teams. Problems are not resolved by imposing tariffs, but by talking.”
This comes after weeks of Trump repeatedly warning Mexico and Canada — two of the United States’ top trading partners — he will impose tariffs if the two countries do not end fentanyl trafficking and the flow of migrants across U.S. border.
He has also complained about deficits in trade after both countries took steps to boost security.
The executive order also has a clause meant to deter Canada from retaliating.
“Should Canada retaliate against the United States in response to this action through import duties on United States exports to Canada or similar measures, the President may increase or expand in scope the duties imposed under this order to ensure the efficacy of this action,” the order read.
Conservative leader Pierre Poilievre called on the federal government to recall Parliament to pass an aid package and hit the U.S. with retaliatory “dollar-for-dollar tariffs.”
“That means targeting U.S. products that we can make ourselves, buy elsewhere or do without. For example, we must retaliate against American steel and aluminium, as Canadians can make those vital products at home,” he said in a statement.
NDP Leader Jagmeet Singh said in a statement, “Today, Donald Trump has unleashed tariffs on Canada that will hurt all of us – and Americans. Now is a time for Canadians to stand strong and stand together. Our values and our solidarity will not crumble in the face of Donald Trump’s economic attack.”
How premiers are responding
Alberta premier Danielle Smith said her province will “work collaboratively with our federal government and fellow provinces on a proportionate response to the imposed U.S. tariffs.”
She added, “Alberta will, however, continue to strenuously oppose any effort to ban exports to the U.S. or to tax our own people and businesses on goods leaving Canada for the United States. Such tactics would hurt Canadians far more than Americans.”
Ontario Premier Doug Ford said he was “extremely disappointed.”
“Canada now has no choice but to hit back and hit back hard,” he said in a statement.”
“The coming days and weeks will be incredibly difficult. Trump’s tariffs will devastate our economy. They’ll put 450,000 jobs at risk across the province. Every sector and region will feel the impact.”
Nova Scotia Premier Tim Houston announced a range of retaliatory measures at the provincial level. He said Nova Scotia will limit access to provincial procurement for American businesses. As of Monday, the cost of tolls at the Cobequid Pass will double for commercial vehicles from the United States.
He also directed the Nova Scotia Liquor Corporation to remove all alcohol from the United States from their shelves as of Tuesday.
British Columbia Premier David Eby said, “It is a declaration of economic war.”
“Effective today, I have directed BC Liquor stores to stop buying American liquor,” he said.
Other premiers also reacted sharply to the news.
“I join Canadians across the country condemning the unjustified tariffs the U.S. introduced on Canadian products,” said Newfoundland and Labrador Premier Anthony Furey, urging Canadians to buy local.
Manitoba Premier Wab Kinew said, “So Trump built a wall, but it’s a wall targeting us. Trump’s tariff tax is an attack on Canada and who we are.”
The Canadian Chamber of Commerce called news of the tariffs “profoundly disturbing.”
“Tariffs will drastically increase the cost of everything for everyone: every day these tariffs are in place hurts families, communities, and businesses,” Candace Laing, the chamber’s CEO and president, said in a statement.
Experts have warned that tariffs by the United States and counter-tariffs from Canada could put inflationary pressure on both economies. For certain goods like fresh fruits and vegetables, prices could start rising almost immediately, economists warned.
For a closer look at how prices on key everyday items could feel the effects of tariffs, read more here.
Former Bank of Canada governor and Liberal leadership candidate Mark Carney said in a statement that he supports “dollar-for-dollar retaliatory tariffs aimed where they will be felt the hardest in the United States but will have the least impact in Canada.”
“At the same time, we need a coordinated strategy to boost investment and to support our Canadian workers through what will be a difficult moment,” he said.
“Over the medium term, if we can no longer rely on American neighbours, we must diversify our trading relationships and build new sources of jobs and growth based on our immense resources, our talented people and their innovation and industry.”
Liberal leadership candidate Chrystia Freeland, the former federal finance minister, urged the government to impose $200 billion worth of retaliatory tariffs.
“I would include on that list 100 per cent tariffs on Teslas. I would include on that list tariffs on whiskey, on cheese, on dairy from the U.S. so that those Wisconsin dairy farmers who voted for Trump see themselves on the list, call up the White House and say, ‘Wait a minute, this is not what we voted for. We did not vote to lose our jobs and lose our markets.’”
Trudeau had warned the United States of a “forceful but reasonable immediate response.”
A day before that looming measure, Trudeau met with the Committee on Internal Trade, made up of premiers and federal officials under the Canadian Free Trade Agreement, in Toronto on Friday.
In his opening remarks before the meeting, Trudeau said Canada is in a “critical moment” after Trump doubled down on his threat Thursday, saying that a 25 per cent tariff on goods coming from Canada and Mexico would be imposed on Saturday.
“If the president does choose to implement any tariffs against Canada, we’re ready with a response — a purposeful, forceful but reasonable immediate response,” Trudeau said.
“It’s not what we want but if he moves forward, we will also act,” he added. “We’re ready for whatever scenario comes forward.”
Is Canada heading for a recession?
Tu Nguyen, economist at RSM Canada, said U.S. tariffs and a response from Canada could likely see the Canadian economy contract by two per cent – a sharp contrast to the projected 1.8 per cent growth rate for 2025.
She said Canada could head into a recession, including job losses and inflation.
“They (tariffs and counter-tariffs) would also lift inflation from the current 2 per cent to a 2.7 per cent headline number, as some of the increased costs from tariffs are passed onto Canadian consumers,” she said.
Nguyen said Canada will likely see lower demand for “all goods and services like new cars, dining out and entertainment.”
The auto sector in the U.S., Canada and Mexico will be particularly hard hit, she said, with the industry losing out to competitors in Europe and Asia.
“The scenario in which economic damage is minimized is one in which a trade agreement is negotiated, putting an end to tariffs. The longer tariffs and retaliation continued, the more fractured and uncompetitive the three countries’ economies became — and the more economic pains consumers would feel from higher prices, fewer goods available and fewer jobs,” she said.
–with files from Global’s Jillian Piper and Mercedes Stephenson