SANDRA M STANWAY
Brooks Bulletin
Despite another month long tariff reprieve on Canadian and Mexican goods by US president Donald Trump, Canada’s tariffs will remain in place.
“These tariffs are unjustified and a clear breach of the North American Free Trade Agreement or CUSMA (Canada United States Mexico Agreement) that was signed by president Trump during his first term” said Alberta premier Danielle Smith.
“This economic attack on our country combined with Mr. Trump’s continued talk of using economic force to facilitate the annexation of our country has broken trust between our two nations in a profound way.”
It’s still not completely clear what Trump’s endgame is. He has been saying the tariffs are because of the amount of fentanyl entering the US from Canada.
Canada has said that less than one per cent of fentanyl is leaving Canada, however, billions of dollars have been spent to appease Trump.
Canada and Alberta have beefed up security at their border, Alberta’s $29 million border security includes officers, inspectors, sniffer dogs and drones who are part of the interdiction team to target drug smuggling, gun and human trafficking and illegal border crossings.
The province also has a two kilometre border zone to give police greater authority to arrest people who are trespassing or interfering with border security questions and Volker Stevin road workers at the border will be trained to look for suspicious activities.
Trump announced that a 25 per cent tariff, with the exception of energy products at 10 per cent, would begin on March 4.
Canada retaliated with $30 billion in counter-tariffs also to begin and March 4 and $125 billion in a second wave which was to have started 21-days later if the US hasn’t pulled back.
On March 6 Trump backed off on most tariffs including giving a month exemption for vehicles coming through the CUSMA.
He announced that there would be additional tariffs from all countries on products entering the US on April 2, the same day that Canada’s second wave of tariffs is now set to begin.
It’s unclear what Trump is planning in his new tariffs.
“The repeated pausing and unpausing of U.S. tariffs is causing great investment uncertainty and market volatility right across North America and continues to confuse Canadians and Americans alike,” Smith said.
Last week Smith presented her retaliation plan,one that she will keep in place regardless of the current pause.
All levels of government and school boards should buy goods from Alberta, Canada or countries with a free trade agreement, retailers will be asked to identify Canadian products and to purchase stock from Alberta or Canada, a Canadian goods advertising campaign will be launched and no additional US alcohol will purchased by retailers.
“We just have to drink a bit more BC wine and Alberta craft beer and spirits and that’s just fine with us,” said Smith.
The government will also enter into free trade and labour mobility agreements with any province.
“The goal is to have no exceptions just free trade and free movement of Canadian workers right across our province.”
She said Alberta has a “trump card:” oil and gas.
“Whether the US president wishes to admit it or not the United States not only needs our oil and gas today they are also going to need it more and more with each passing year once they notice their declining domestic reserves and production are wholly insufficient to keep up with the energy demands of US consumers and industry let alone having anything leftover to export as they do today,” she said.
The Canadian Cattle Association is analyzing the tariff impact on producers and is predicting that cattle prices will drop in the range of 15 to 16 per cent with some offset by the tariffs.
“That’s a huge impact on both producers and processors,” said Dennis Laycraft, executive vice president of the association.
About 40 per cent or $6 billion worth of beef and live cattle is sold to the U.S. while $1 billion is sold to the rest of the world.
“You just don’t move $6 billion into another market.”
On Friday, the federal government announced the $5 billion Trade Impact Program to help exporters reach new markets and to help companies that are facing economic challenges imposed by the tariffs.
There is also $500 million available in loans through the Business Development Bank of Canada and $1 billion in new financing to Farm Credit Canada.
“The considerations for workers, businesses and agriculture are strong first steps to mitigating the damage caused by the US-provoked trade war,” said Matthew Holmes, executive vice president and chief of public policy at the Canadian Chamber of Commerce.
The chamber is urging the federal government to reduce red tape, lower taxes, build trade infrastructure and address internal trade irritants.
This week Trump is expected to impose a 25 per cent tariff on steel and aluminium and there are reports that it will be on top of the other tariffs which means there would be a 50 per cent tax.
“Our tariffs will remain in place until the US tariffs are withdrawn and not a moment sooner,” said prime minister Justin Trudeau, just days before he left office, having stepped down in early January.
