The imposition of full U.S. tariffs on Canada places approximately one million Canadian jobs at risk, says Immigration Minister Marc Miller.
“No matter what we do, if tariffs come into place, it is going to be painful for the Canadian economy. A million jobs at risk is no joke,” Miller said during a March 3 press conference in Montreal. “It’s something that we have to take seriously.”
Miller’s comments came before U.S. President Donald Trump said later that day he would impose tariffs on Canada and Mexico, noting there’s nothing either country could do to avoid them at this stage.
Trump had imposed the 25 percent tariffs on all goods and 10 percent on energy imports in early February before granting a 30-day pause to assess measures taken by Canada and Mexico to deal with border security and drug trafficking. The pause expired at 12:01 a.m. on March 4.
Miller and other cabinet ministers were in Washington, D.C., in recent days for meetings with U.S. officials to discuss border issues and find a path to avoid the tariffs.
Miller said he came out of those meetings with “some ambivalence, not knowing whether they’ve been useful or useless.”
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Canadian officials like Miller have sought to highlight that the Canadian border is much less problematic than the Mexican border for the United States in terms of illegal migration and drug smuggling.
“It doesn’t mean we don’t have our challenges, but the reality is that the northern border, our southern border, is one that is an asset. It’s not a liability,” said Miller.
The Canadian economy is largely dependent on free access to the United States. The majority of U.S. states also have Canada as their main export client.
“We can’t replace an economy that is responsible for 80 percent of our trade overnight, and it’s going to hurt,” said Miller.
An analysis by CIBC suggests that the long-lasting tariffs of 25 percent on goods and 10 percent on energy could lead to a drop of 5 percent of Canada’s gross domestic product (GDP).
Bank of Canada Governor Tiff Macklem said in late February the consequences of a trade war will be “severe” and different from the COVID-19 economic crash and rapid recovery.
“This time, if tariffs are long-lasting and broad-based, there won’t be a bounce-back,” he said.
Prime Minister Justin Trudeau said Ottawa would respond with 25 percent counter tariffs on $155 billion worth of U.S. goods. The first phase of $30 billion in tariffs went into effect on March 4 and the second phase of $124 billion will take effect in 21 days.
Trudeau said there is “no justification” for the Trump administration’s decision to impose those tariffs.
“While less than 1 percent of the fentanyl intercepted at the U.S. border comes from Canada, we have worked relentlessly to address this scourge that affects Canadians and Americans alike,” he said in a statement.
Trump explained his decision to implement the tariffs on March 3 by saying that “vast amounts of fentanyl have poured into our country from Mexico, and as you know, also from China, where it goes to Mexico and goes to Canada.”
This was in contrast to a statement from the White House in mid-February which said Trump had “leveraged tariffs to force Canada and Mexico to make long-overdue changes at our northern and southern borders, ensuring the safety and security of American citizens.”
Along with the border-related tariffs, Canada is also facing the U.S. threat to impose a universal 25 percent surtax on steel and aluminum, set to come into force on March 12. Trump’s reciprocal tariffs, to match what other countries impose on the United States, are slated for April 2.
