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Canada can cope with US tariffs, economists say
Economy
Canada's finance minister met with the country's top economists,
who assured him that the damage from the escalating trade war with the United States would be manageable. Finance Minister François-Philippe Champagne held a closed-door meeting with top economists in Toronto to discuss the outlook following the breakdown of trade talks with the United States, Bloomberg reports.
On Saturday, the United States imposed 50% tariffs on approximately $20 billion worth of Canadian imports, including electrical equipment, plastics, and plywood. These measures are in addition to previously imposed US duties on steel, automobiles, aluminum, lumber, and other products.
Meeting participants noted that Canada's economy is resilient enough to withstand President Donald Trump's tariff measures, and the damage will likely be concentrated in the industries directly affected by the tariffs. According to Bloomberg, citing several meeting participants, the risk of a recession was largely absent from discussion.
The Canadian government responded by imposing new tariffs on a wide range of American goods, effective September 8. Canada doubled existing counter-tariffs on some American steel and aluminum products to 50%.
This week, Trump threatened to impose 50% tariffs on Canadian automobiles, and on auto parts starting January 1. Officials in Ottawa believe the trade impasse could drag on beyond the US midterm elections in November. Carney stated that his government is prepared to support industries affected by the tariffs for as long as necessary.