Canada has been working to “prepare for the worst” as the country braces for a new set of tariffs from U.S. President Donald Trump that could hit as early as next week, Prime Minister Mark Carney says.
Carney spoke Tuesday while at an event in Nova Scotia, where he was campaigning as Liberal leader in the federal election but was asked about how he and the caretaker government he still leads are preparing for the April 2 tariffs.
On April 2, the U.S. is set to impose sweeping and “comprehensive” reciprocal tariffs on all its trading partners.
Trump said the tariff would differ depending on the tariffs individual countries impose on U.S. goods.
Carney was asked what Canada’s strategy should be ahead of the next round of tariffs set for April 2, which will be on top of 25 per cent tariffs imposed earlier in March and additional 25 per cent tariffs on steel and aluminum two weeks ago.
“What you do is you prepare for the worst. And that’s part of what we have done in the last weeks. We have made substantial changes to unemployment insurance [sic] program to support Canadian workers,” he said.
Under the caretaker convention, Carney can still act in the prime ministerial capacity during an election campaign but is expected to restrain any actions to matters that are routine, non-controversial, reversible, agreed to by opposition parties or “urgent and in the public interest.”
That could include responding to additional tariffs from the U.S.
Carney said Canada will be ready with “retaliatory tariffs in a way that has maximum impact on America and minimum impact on Canada.”
The revenue from the tariffs, he said, would be used to fund worker protection programs.
He added that this will be accompanied by a greater emphasis on Canadian procurement for large projects as well as rapidly removing interprovincial trade barriers, which are expected to blunt the impact of Trump’s trade war.
Trump’s executive order described “non-reciprocal trade relationships” in very broad terms, including any tariffs on U.S. products, taxes and non-tariff barriers on U.S. businesses, workers and consumers and “policies and practices that cause exchange rates to deviate from their market value.”
A non-reciprocal trade relationship, the executive order said, would be one which “in the judgment of the United States Trade Representative … imposes any unfair limitation on market access.”
Trump on Monday said he “may give a lot of countries breaks” from the so-called “reciprocal” tariffs.
Trump made the comment after Bloomberg and the Wall Street Journal reported Monday that what is meant to be a global matching of tariffs imposed on U.S. goods starting on April 2 — which Trump has touted as “Liberation Day” — may be far narrower and exempt some countries and specific sectors.
“I may give a lot of countries breaks,” Trump said at an announcement at the White House when asked about the reports, but he did not say specifically which ones.
“We’ll be announcing some additional tariffs over the next few days, having to do with automobiles, cars, and having also to do with lumber down the road — lumber and [semiconductor] chips,” Trump said.
“We’ve been ripped off by every country,” he told reporters after a meeting of his cabinet earlier Monday, predicting that the tariffs expected on April 2 would raise “rather astronomical” amounts of money for the U.S., allowing tax rates to remain low or come down.
— with files from Global’s Sean Boynton