The worsening of U.S.-Canada relations: Trump threatens a comprehensive "tariff blockade" in response to the rapprochement with Beijing
The political landscape between Washington and Ottawa has undergone a dramatic transformation, as U.S. President Donald Trump threatened to impose a 100% tariff on all imports coming from Canada. This escalation comes in response to Canadian Prime Minister Mark Carney's move to strengthen trade ties with China and his recent statements regarding "Greenland."
Key points of escalation and confrontation:
A shift in the American stance: In just one week, Trump went from supporting the idea of the agreement (on January 16) to threatening to destroy cross-border trade on Saturday, accusing Canada of becoming a "landing platform" for Chinese goods to bypass American restrictions.
The Canada-China agreement: Ottawa aims to ease restrictions on Canadian agricultural exports through its agreement with Beijing, in exchange for facilitating the entry of Chinese electric vehicles into Canadian markets at reduced tariffs (6.1%), which Washington sees as a direct threat to its economic security.
The "Greenland" dispute and international law: The disagreements were not limited to trade; they extended to sharp criticisms Trump directed at Carney after the latter's speech in "Davos," where Carney defended the sovereignty of Greenlandic citizens over their land, criticizing the American desire to control it.
Official and economic reactions:
The Canadian Chamber of Commerce strongly defended the agreement, asserting that opening up to China aims to serve the local consumer and does not seek to replace the historic and deep partnership with the United States. It emphasized that stable relations with Beijing enhance the competitiveness of North America as a whole, not the other way around.
The impact of these developments on the markets:
Imposing a 100% tariff effectively means halting supply chains between the two countries, which will lead to:
Rising inflation costs in the United States (especially in the energy and automotive sectors).
Severe pressure on the Canadian dollar against major currencies.
Sharp fluctuations in stocks of the automotive and agriculture sectors that rely on cross-border trade.
