Toronto Region Board of Trade Responds to U.S. Tariffs

“On Saturday, as threatened, U.S. President Donald Trump moved to unravel nearly four decades of free trade and a highly successful integrated cross-border economy—slapping punitive 25% tariffs on Canadian exports to the U.S., except for energy which will receive 10%. This completely unjustified attack on Canada will trigger severe economic disruption to our $3-trillion economy and cause painful supplier shortages and higher costs for Americans.

The Canadian government has rightly responded to this unprecedented action with strategic and targeted retaliatory tariffs on U.S. exports to Canada—as of Tuesday, 25% on $30-billion of U.S. goods, rising to $155-billion in 21 days.

• First, these tough countermeasures are essential to protect Canadian businesses in our domestic market at a time when they will be shut out of the U.S. while American businesses would otherwise continue to enjoy free access to the Canadian market.
• Second, measured and calibrated actions demonstrate Canada’s resolve to defend its vital economic interests, while limiting additional harm to our economy.
• Third, the response must inflict enough pain to command the full attention of U.S. federal, state and business decision-makers, already amply distracted by the two-week-old administration’s wave of high-profile domestic policy actions, and bring the administration to the negotiating table. The trick will be to secure a fair and rapid resolution without escalating a trade war we cannot afford.
• Fourth, the President’s fabricated narrative, now taking hold in U.S. public opinion, about Canada’s status as a trade “freeloader,” or “playing a central role” in America’s opioid drugs and illegal migration crises, must be loudly and persuasively refuted in the U.S. media and to decision makers.

The numbers speak for themselves. Aside from Canadian oil and gas exports, which the U.S. depends on to fuel its rapidly growing economy (and which is sold at a discount), Americans have run a trade surplus with Canada for over 17 years. In goods and services it amounted to $60 billion last year. Contrary to the assertion that Canada is drawing manufacturing out of the U.S., the reverse has been true for more than a decade. Again, President Trump’s pretext for an all-out trade war has no basis in reality.

Toronto Region Board of Trade is working hard to ensure that the interests of our members and the broader Toronto region business community are heard at Queen’s Park, in Ottawa and with our big city chambers of commerce partners in Canada and the U.S. Our American counterparts must be made to clearly understand that President Trump’s distortion of reality is the cause of significant economic hardship for them.

Beyond the immediate crisis, this moment underscores the urgent need to take immediate action to strengthen Canada’s economy, to retain investment and production. Without delay, on the table must be significant tax and regulatory reform and the removal of interprovincial trade barriers to maximize our business and market competitiveness. The imperative is now to take full advantage of our domestic market while pushing aggressively to diversify trade internationally.”