On the 24th, President Donald Trump openly threatened Canada, America’s second-largest trading partner, with 100% tariffs over a potential deal with China. This has deepened a divide between Trump and Canadian Prime Minister Mark Carney, continuing their back-and-forth from the last time Canadian tariffs were raised after Carney’s Ontario anti-tariff ad, which featured former President Ronald Reagan’s speech about tariffs.
Continuing the animosity, Trump has mockingly referred to Carney as “governor,” a term he had also used for former Prime Minister Justin Trudeau, and a play on his past statements about making Canada the 51st state. Specifically, he posted on his Truth Social that “if Governor Carney thinks he is going to make Canada a ‘drop-off port’ for China to send goods and products into the United States, he is sorely mistaken. China will eat Canada alive, completely devour it, including the destruction of their businesses, social fabric, and general way of life.”
The statement has come as a surprise, as the president had previously told reporters on January 16 that “it’s a good thing for (Carney) to sign a trade deal. If you can get a deal with China, he should do that,” yet it seems his stance on that has now completely flipped, as in a follow-up post on his Truth Social he said, “The last thing the world needs is to have China take over Canada. It’s NOT going to happen, or even come close to happening!”
While it’s unclear what constitutes a “deal” under Trump’s threat, the statement is most likely in reference to the “new strategic partnership” meeting Carney had with Chinese President Xi Jinping. They discussed Canada easing tariffs on Chinese EVs and allowing up to 49,000 Chinese electric vehicles into its market annually. In trade, China is also expected to reduce tariff barriers on Canadian canola seed, lobster, and peas later this year.
It is currently unclear what effects these 100% tariffs could have if imposed. Currently, Canadian goods that are compliant with the United States-Mexico-Canada Agreement’s (USMCA) guidelines have been exempt from Trump’s levies. However, the USMCA was brokered during Trump’s first term and is set to go under review, so it is uncertain whether compliant goods will be safe from the potential tariffs. Currently investors are not concerned about the tariff threats, as most investors have deemed them a “TACO,” or “Trump Always Chickens Out” situation.
It has been questioned if Trump could even impose these tariffs, as the Supreme Court is set to make a ruling in the coming weeks, as justices have appeared skeptical of the Trump administration’s use of the International Emergency Economic Powers Act to impose tariffs due to it making no mention of tariffs.
Regardless of the fact the threats might be empty, Trump and Carney have still engaged in hostility online, with Trump posting on Truth Social that “Canada lives because of the United States. Remember that, Mark, the next time you make your statements,” to which Carney responded that “Canada doesn’t live because of the United States. Canada thrives because we are Canadian.”
