Standing within the Rose Backyard on Wednesday afternoon to unveil his new reciprocal tariffs, U.S. President Donald Trump once more falsely claimed that the U.S. subsidizes Canada by lots of of billions of {dollars} yearly and misrepresented Canada’s tariffs on U.S. dairy merchandise.
“We subsidize lots of international locations and maintain them going and maintain them in enterprise,” Trump mentioned. “Within the case of Mexico, it is $300 billion. Within the case of Canada, it is near $200 billion a yr.”
That declare — which Trump has routinely made going as far back as December — is unfaithful in a number of methods. What the U.S. president was referring to is his nation’s commerce deficit with Canada, that means Canada exports extra to america than the U.S. exports to Canada.
U.S. President Donald Trump has introduced sweeping new tariffs, together with 10 per cent levies on just about all imports, and considerably increased reciprocal tariffs in opposition to greater than 60 international locations, however Canada and Mexico had been spared for now.
In response to the Workplace of america Commerce Consultant, The U.S. items trade deficit with Canada was $63.3 billion in 2024, down from $64 billion in 2023. That is far lower than Trump claimed on Wednesday.
There’s one other issue to think about: the value of power. In response to Statistics Canada, power exports resembling oil, pure fuel and electrical energy make up about one-third of the products Canada despatched south final yr.
Specialists have previously told CBC News the scale of the U.S. commerce deficit with Canada is basically a operate of oil costs. If oil costs go down the deficit shrinks, and vice versa if oil costs rise. Additionally they say commerce deficits are usually not a type of subsidy.
Take away power, specialists instructed CBC Information, and it is truly Canada that has the commerce deficit.
Canada’s tariffs on U.S. dairy
Throughout his speech, Trump additionally claimed Canada imposes a “250 to 300 per cent tariff on lots of our dairy merchandise. They do the primary can of milk, the primary carton of milk at a really low worth however after that it will get dangerous.”
“Check out what occurs down the highway if you look somewhat bit, it isn’t a reasonably image,” Trump added. “And it isn’t truthful. It isn’t truthful to our farmers, it isn’t truthful to our nation.”
President Donald Trump says Canada has been ripping off america, imposing tariffs of as much as 400 per cent on imported American dairy merchandise. Andrew Chang breaks down Trump’s claims, explaining how dairy tariffs work and the way doubtless it’s that anybody is definitely paying such sky-high costs.
Photos provided by Reuters, Getty Photos and The Canadian Press. Further credit (Credit score: 9:17 Skotidakis/Fb), (Credit score: 9:21 Elite Dairy).
His declare shouldn’t be fully true. These excessive tariffs on U.S. dairy solely apply if exports exceed set quotas. Beneath the quotas, the U.S. dairy merchandise enter tariff-free due to the Canada-United States-Mexico Settlement (CUSMA), in accordance with the U.S. Department of Agriculture.
In response to the International Dairy Foods Association, the U.S. has by no means come near exceeding its quotas. However the affiliation argues it is “as a result of Canada has erected numerous protectionist measures that fly within the face of their commerce obligations made underneath [CUSMA].”
The place is Canada now with tariffs?
Regardless of Trump’s grievances on Wednesday, the White Home mentioned there will probably be no extra across-the-board levies utilized to Canada than what has beforehand been introduced.
Trump mentioned nevertheless that he’s going forward with a 25 per cent tariff on “all foreign-made” cars as of midnight Wednesday, which may have extreme implications for the Canadian auto sector.
The White Home mentioned that tariff charge will apply to Canadian-made passenger autos, however there’s a caveat — it should solely be levied on the worth of all non-U.S. elements in that car.
On Thursday morning, Prime Minister Mark Carney announced Canada is retaliating against Trump’s latest move with a 25 per cent tariff on autos imported from the U.S. that aren’t CUSMA-compliant. Mexico won’t be impacted.
In March, Trump slapped 25 per cent tariffs on Canadian metal, aluminum and items that aren’t CUSMA-compliant. He additionally imposed 10 per cent tariffs on power merchandise underneath CUSMA, in addition to potash not coated by the commerce settlement.
Canada positioned retaliatory tariffs on roughly $60 billion price of U.S. items in response to Trump’s strikes final month.
Source link