fbpx
News

Trudeau`s Criticism Will Cost Canada A Lot Of Money [Video]

Donald Trump has doubled down on his criticism of Justin Trudeau, warning that his stance on trade discussions was a “mistake” that would cost Canada “a lot of money”.

At a news conference on Tuesday after his summit with North Korean leader Kim Jong-un, Trump referred to the Canadian prime minister’s pledge to proceed with retaliatory measures in response to Trump’s move to impose tariffs on aluminum and steel.

“That’s going to cost a lot of money for the people of Canada. He learned,” Trump said, wagging his finger. “You can’t do that. You can’t do that.”

Trump offered no detail, but his comments marked the latest in a string of abrasive remarks from senior US officials – and appeared to dash any hopes of a swift resolution to the trade row which has helped push relations between the two countries to their lowest point in recent memory.

Analysts warned that the US president’s next target could be the country’s automotive sector, a move that would further punish Canada – but also unleash a cascade of economic consequences on both sides of the border.

“What you’re essentially talking about is dropping a nuclear bomb in middle of the North American industrial economy and waiting for the consequences to play out,” said Eric Miller, an economist and global fellow at the Canada Institute at the Woodrow Wilson Center.

Trump has previously floated the idea of implementing a 25% tariff on automobiles coming across the Canadian border. But years of trade and investment between the two nations has produced a tightly-integrated manufacturing system, blurring the lines on country of origin: on average, a vehicle passes the border seven times during the manufacturing process.

As a result, a pre-emptive attack on the Canadian automobile manufacturing network – the largest supplier to the US – would have lasting effects for Americans.

“You are looking at direct and indirect employment in the sector of hundreds of thousands of people in Canada and millions of people in the United States,” said Miller, pointing out that every job in the automotive sector creates an estimated seven peripheral jobs.

The proposed tariff would add an additional $6,250 to a $25,000 car, said Miller.

Canada would likely join other countries in retaliation, including Japan, Mexico and the European Union, causing equivalent price spikes for American consumers and ripples that could morph into waves throughout the economy.

“The United States can inflict a lot of damage on the Canadian economy. But the reality is that by doing so, it would inflict damage upon itself,” said Patrick Leblond, an international trade expert at the Centre for Internal Governance Innovation.

Trump, who was elected on a promise to restore US manufacturing jobs, has previously attacked car manufacturers based in Europe, Japan and Canada.

But a trade war is likely to most affect some of the states that handed him the presidency, which is themselves dependent on foreign commerce: 36 states count Canada as their largest trading partner.

Meanwhile, Canada depends heavily on the US economy for trade – making it particularly vulnerable to disruptions. For years, Canada has supplied its southern neighbor with raw materials: grain, lumber, oil, steel and aluminum.

“At some point, something’s got to give. And when Americans start losing their jobs, they’re going to go back to their senators and say: ‘What are you doing about this? We just lost our jobs and it’s because of Trump’s policies,’” said Leblond.

“Canada and the United States have one of the largest trading relationships in the world and amid that, one of the most balanced trading relationships,” said Michael Gregory, deputy chief economist at BMO World Markets.

Trump has also taken aim at Canada’s convoluted dairy supply management system, valued at $21bn. Initially developed as a means of protecting farmers, the system places hefty duties on imported dairy products, discouraging imports of American dairy products while favoring domestic production.

While the escalating trade spat is unfolding under the auspices of a Nafta renegotiation, the American’s chief negotiator in the pact, Robert Lighthizer has remained silent amid outbursts from other top trade officials.

Canadian officials remain committed to staying in the trade pact and will continue to negotiate, said Miller, but tariffs will continue to be met with proportional countermeasures.

“If you wanted to start a global trade war, targeting the auto sector would be the way to do it,” he said.

This story originally appeared in The Guardian. Image courtesy of  Saul Loeb/AFP/Getty Images.

Join The Discussion

Five Takeaways From President Macron
‘Gilets Jaunes’: Five Takeaways From President Macron [Video]
Six Dead And Dozens Hurt In Nightclub Stampede In Italy
Six Dead And Dozens Hurt In Nightclub Stampede In Italy [Video]
Paris On Lockdown Ahead Of Planned Protests
Paris On Lockdown Ahead Of Planned Protests [Video]
Luxembourg To Become First Country To Make Public Transport Free
Luxembourg To Become First Country To Make Public Transport Free
Worldwide Adoption Keeps Growing, 1,500 Restaurants In Denmark Accept Bitcoin
Worldwide Adoption Keeps Growing, 1,500 Restaurants In Denmark Accept Bitcoin
Half The Crypto Market Eliminated In Less Than A Mont
Half The Crypto Market Eliminated In Less Than A Mont
Singapore Residents Targeted In Crypto Scams, $78,000 Lost
Singapore Residents Targeted In Crypto Scams, $78,000 Lost
Brazilian Mining Company Under Investigation, Says It Can’t Pay Investors
Brazilian Mining Company Under Investigation, Says It Can’t Pay Investors
Visual Trends To Be Aware Of In 2019
Visual Trends To Be Aware Of In 2019 [Infographic]
How To Get Sponsored Posts For Your Blog
How To Get Sponsored Posts For Your Blog
The Advantages YouTube Ads Have Over Facebook Ads
The Advantages YouTube Ads Have Over Facebook Ads [Video]
7 Tools Will Help You Kick Butt In 2019
7 Tools Will Help You Kick Butt In 2019 [Video]
Instagram's Testing Side-Scrolling Feed View, Similar To Stories
Instagram’s Testing Side-Scrolling Feed View, Similar To Stories
The 10 Best Instagram Tools For 2019
The 10 Best Instagram Tools For 2019
Pinterest's Recommendation Algorithms Are Improving
Pinterest’s Recommendation Algorithms Are Improving
YouTube Launches YouTube Stories, Prominent Creators Only
YouTube Launches YouTube Stories, Prominent Creators Only [Video]
Wish You Were Smarter
Wish You Were Smarter? These 4 Brain Hacks Can Help You Get There
Weightlifting Less Than An Hour Per Week Could Increase Your Longevity
Weightlifting Less Than An Hour Per Week Could Increase Your Longevity
Your Environment May Affect Your Eyes More Than You Realize
Your Environment May Affect Your Eyes More Than You Realize
Why Hotels Want You To Stop Instagramming Your Vacation
Why Hotels Want You To Stop Instagramming Your Vacation
Five Takeaways From President Macron
‘Gilets Jaunes’: Five Takeaways From President Macron [Video]
Six Dead And Dozens Hurt In Nightclub Stampede In Italy
Six Dead And Dozens Hurt In Nightclub Stampede In Italy [Video]
Paris On Lockdown Ahead Of Planned Protests
Paris On Lockdown Ahead Of Planned Protests [Video]
The Advantages YouTube Ads Have Over Facebook Ads
The Advantages YouTube Ads Have Over Facebook Ads [Video]