The tariffs that Donald Trump has threatened to impose on Canada would also cause problems to US states if he enacts them, the head of the Canadian foreign investment promotion agency told AFP.
“I think from a business perspective, no one will benefit from a tariff regime,” Laurel Broten, chief executive of Invest in Canada, said in an interview during a visit to Paris.
Trump, who takes office in January, has threatened to slap 25 percent tariffs on imports from Canada and Mexico, accusing both of allowing the United States to be flooded with illicit drugs and undocumented migrants.
In response, Canada’s largest province, Ontario, said it would be prepared to cut off energy exports to the United States if Trump makes good on this threat.
“The establishment of tariffs would not only be problematic for Canada, it would be problematic for many US states,” Broten said.
“I think the government of Canada and the US government will need to work through this.”
She said the economies of the neighbouring countries are closely intertwined, notably in the energy and auto sectors.
Broten gave the example of car parts that cross the border “six or seven times” for the production of a vehicle.
“A piece comes from here, it gets attached to something here, it comes back across. So that’s the level of integration of the economy,” she said.
“There’s no car manufacturer in North America that wants to see seven tariffs on their vehicle parts as they cross the border.”
Canadian Prime Minister Justin Trudeau, who flew to Trump’s Florida estate, Mar-a-Lago, in November to discuss the issue, said last week that the proposed tariffs would be “devastating” for his country.
Broten said the US and Canadian governments had “a good working relationship” during the first Trump term in 2017-2021, recalling that a free trade agreement had been renegotiated at the time.
“I know the government is committed to engaging directly on this, so that businesses on both sides of the border continue to succeed,” she said.
“I think the government is being thoughtful about it and making sure that we also don’t overreact. President Trump isn’t even in office yet. And so we need to be calm.”
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