INTERNATIONAL
Trump tariff threat to Canada mere 'bluster', expert says
A composite image showed Canadian Prime Minister Mark Carney (left) and U.S. President Donald Trump (right) amid heightened trade tensions following Trump's threat to impose steep tariffs on Canadian goods. (REUTERS)
KUALA LUMPUR: Threats of imposing a 100% tariff on Canadian goods amount to political posturing and are unlikely to be carried out, with the United States already holding legal remedies under existing trade rules, a policy expert said.
AI Brief
Barrett Bingley, Asia regional director at the Asia Pacific Foundation of Canada, said the U.S President Donald Trump's rhetoric appeared linked to upcoming reviews of the North American free trade pact rather than a concrete policy shift.
Under the existing United States–Mexico–Canada Agreement (USMCA), he said Washington already has the right to withdraw if Canada were to sign a trade deal with a non-market economy, he said.
"This was Donald Trump's deal, and that clause (Article 32.10) was negotiated as part of it.
"The fact this threat is being raised at all suggests a degree of bluster rather than a seriously considered policy response by the U.S. president,” he told AWANI International.
Canadian Prime Minister Mark Carney and Trump have repeatedly traded barbs in recent weeks, after the Canadian leader criticised Washington’s trade policy in a speech at the World Economic Forum.
Trump responded by saying Canada “only exists” because of the United States and threatened to impose a 100% tariff on Canadian imports if Ottawa pursued a trade deal with China.
Carney later said Canada had "no intention" of negotiating a free trade agreement with China and would honour its obligations under the USMCA, including notifying the U.S. and Mexico before entering any such talks.
Trump on Thursday announced the decertification of Bombardier’s Global Express jets and threatened 50% tariffs on Canadian-made aircraft unless Canada certified planes produced by U.S. rival Gulfstream.
Bingley said similar tariff threats made by Trump in the past had rarely resulted in formal executive action.
"If this were a serious policy proposal, we would see consultations, staffing and negotiations underway, and none of that is happening,” he said.
However, if a 100% tariff were imposed, Bingley said the initial economic impact would fall on U.S. buyers.
Canada primarily supplies intermediate goods such as auto parts, aluminium, electricity and heavy crude oil, which U.S. manufacturers rely on and cannot easily replace in the short term, he said.
For hard-to-substitute goods such as heavy crude and aluminium, U.S. buyers would initially absorb the tariff costs, which would eventually be passed on to consumers, Bingley added.
AI Brief
- Threats of imposing a 100% tariff on Canadian goods seen as political posturing, according to a policy expert.
- Under the existing USMCA, the U.S. holds the right to withdraw if Canada enters a deal with a non-market economy.
- Despite Trump's recent tariff threats on Canadian imports, experts suggest that these aggressive actions are more likely bluster as they have not progressed to formal executive orders or legislation.
Barrett Bingley, Asia regional director at the Asia Pacific Foundation of Canada, said the U.S President Donald Trump's rhetoric appeared linked to upcoming reviews of the North American free trade pact rather than a concrete policy shift.
Under the existing United States–Mexico–Canada Agreement (USMCA), he said Washington already has the right to withdraw if Canada were to sign a trade deal with a non-market economy, he said.
"This was Donald Trump's deal, and that clause (Article 32.10) was negotiated as part of it.
"The fact this threat is being raised at all suggests a degree of bluster rather than a seriously considered policy response by the U.S. president,” he told AWANI International.
Canadian Prime Minister Mark Carney and Trump have repeatedly traded barbs in recent weeks, after the Canadian leader criticised Washington’s trade policy in a speech at the World Economic Forum.
Trump responded by saying Canada “only exists” because of the United States and threatened to impose a 100% tariff on Canadian imports if Ottawa pursued a trade deal with China.
Carney later said Canada had "no intention" of negotiating a free trade agreement with China and would honour its obligations under the USMCA, including notifying the U.S. and Mexico before entering any such talks.
Trump on Thursday announced the decertification of Bombardier’s Global Express jets and threatened 50% tariffs on Canadian-made aircraft unless Canada certified planes produced by U.S. rival Gulfstream.
Bingley said similar tariff threats made by Trump in the past had rarely resulted in formal executive action.
"If this were a serious policy proposal, we would see consultations, staffing and negotiations underway, and none of that is happening,” he said.
However, if a 100% tariff were imposed, Bingley said the initial economic impact would fall on U.S. buyers.
Canada primarily supplies intermediate goods such as auto parts, aluminium, electricity and heavy crude oil, which U.S. manufacturers rely on and cannot easily replace in the short term, he said.
For hard-to-substitute goods such as heavy crude and aluminium, U.S. buyers would initially absorb the tariff costs, which would eventually be passed on to consumers, Bingley added.