Canada’s potential next Prime Minister threatens Trump with “biggest trade blow” the U.S. has ever endured.
At a Glance
- Chrystia Freeland, Liberal leadership candidate, proposes targeting Tesla vehicles and U.S. alcohol with retaliatory tariffs
- Trump plans to impose 25% tariffs on Canadian steel and aluminum imports
- Freeland emphasizes Canada’s economic leverage as the largest market for the U.S.
- Canada plans “dollar for dollar” retaliation, targeting specific American stakeholders
- Rival candidate Mark Carney advises against revealing Canada’s strategy prematurely
Freeland’s Bold Stance Against U.S. Tariffs
Chrystia Freeland, former Canadian Minister of Finance and Deputy Prime Minister, has taken a resolute position against potential U.S. tariffs on Canadian metal imports. As a leading candidate to replace Justin Trudeau as Head of the Liberal Party, Freeland has proposed a strategic retaliation plan that could significantly impact key U.S. industries and influential figures.
President Donald Trump has announced plans to impose a 25% tariff on Canadian steel and aluminum, effective March 12. In response, Freeland has threatened what she describes as the “biggest trade blow” the U.S. has ever endured, emphasizing Canada’s economic leverage as America’s largest trading partner.
Chrystia Freeland has called for economic retaliation if President-elect Trump follows through with his threat to impose tariffs. https://t.co/7fqgoP1Jzl
— Newsweek (@Newsweek) January 17, 2025
Targeted Retaliation Strategy
Freeland’s proposed counter-tariff strategy is designed to galvanize affected sectors and stakeholders within the U.S. to advocate for rescinding the tariffs. The plan includes a 100% tariff on U.S. wine, beer, spirits, and Tesla vehicles, aiming to send a clear message to Trump’s allies and influential figures such as Tesla CEO Elon Musk.
“We need to be very targeted, very surgical, very precise,” Chrystia Freeland said.
The strategy also considers targeting Wisconsin dairy farmers and other lobby groups that hold sway with the Trump administration. By focusing on these specific sectors, Freeland aims to apply both economic and political pressure on the U.S. government to reconsider its tariff policy.
Potential Economic Impact
The proposed retaliatory measures could have significant consequences for both countries. Tesla CFO Vaibhav Taneja has already expressed concerns that such tariffs could affect the company’s profitability. Similarly, the potential ban on Wisconsin dairy products could impact a crucial agricultural sector in a key political battleground state.
Freeland has urged the Canadian government to publish a comprehensive retaliatory tariff list, larger than the actual targets, to emphasize the seriousness of Canada’s response. This approach aims to demonstrate that Canada is prepared to match the U.S. tariffs “dollar for dollar” if necessary.
Differing Approaches Within the Liberal Party
While Freeland advocates for a proactive and public stance on retaliation, her rival for Liberal Party leadership, Mark Carney, has advised a more cautious approach. Carney, leveraging his economic background as a former Bank of Canada governor, suggests waiting until the U.S. acts before revealing Canada’s strategy.
“We have negotiators literally at the front line,” Mark Carney said.
Carney emphasizes the importance of not undermining Canadian negotiators currently in talks with the U.S. This difference in approach highlights the ongoing debate within Canadian leadership about how best to address the potential trade conflict with their largest trading partner.
