Welcome back to This Week in Canada, your one-stop shop for all the drama you didn’t realize you needed. This week, Donald Trump makes Canada read the fine print on tariffs, Mark Carney hopes for the best on Palestinian statehood, Montreal Pride bans a Jewish LGBTQ+ group in the name of inclusion, and more. Let’s jump into it!
August 1 came and went. That was the big deadline to strike a trade deal with the U.S.—and Canada didn’t land one. Instead, President Donald Trump signed an executive order July 31 that imposed a 35 percent tariff, up from 25 percent, on everything not covered by the United States-Mexico-Canada Agreement (USMCA). Hardly seismic, since less than 10 percent of Canada’s trade with the U.S. isn’t compliant with USMCA.
Before the tariff increase, the “effective” U.S. tariff on Canadian goods—or the value of duties paid as a percentage of the value of total imports—was just 1.7 percent to 2.2 percent, according to calculations by the Budget Lab at Yale University. Canada got off easily compared to the global effective tariff of about 9 percent.
Trump’s order might result in Canada’s rate creeping above 2 percent, which is nowhere close to that of Japan, Vietnam, the United Kingdom, and the European Union.
You might think that the outcome would stop Canadians from running around as if their hair were on fire, just like they did when the U.S. president threatened to “annex” Canada. Nope.
Doug Ford, the premier of Ontario, Canada’s largest province, said that Canada “shouldn’t settle for anything less than the right deal.”
“Now is not the time to roll over,” he added, while urging Ottawa to retaliate with a 50 percent tariff on U.S. steel and aluminum.
