OTTAWA — Canadians are watching closely Donald Trump’s political comeback in the United States.
Observers say a Trump victory could mean economic instability with hefty tariffs and brash decisions that could destabilize the world stage, including its friendly neighbour up north. Republicans are taking back control of U.S. Senate, whereas it remains to see which party will control the House of Representatives.
The National Post spoke with Senator Peter Boehm, former ambassador and Canadian Sherpa for the G7 in Charlevoix, Louise Blais, former ambassador to the United Nations and now senior advisor to the Business Council of Canada, as well as Garry Keller, former chief of staff to Canada’s foreign affairs minister and vice president at StrategyCorp, to get their views on the challenges that lie ahead for Canadians.
TARIFFS
Whatever the outcome of the U.S. election, one thing was clear: Canada will have to constantly remind its biggest trading partner that their economies are intertwined.
“The work that we have to do is always to remind Americans to take into consideration the fact that their supply chains are extremely integrated with Canada, that we make things together, and that Canada is their number one customer,” said Blais.
As described by Keller: “You have to say it over and over and over and over and over and over again. That’s just the reality.”
Trump has promised to impose a universal tariff of 10 per cent on all imports entering the United States and has suggested at times it could be 20 per cent. Until now, there is no indication that Canada will be exempted which would cost the economy tens of billions.
“We will definitely have to work for it. I don’t think we’re going to get a free pass just because we’re Canada,” said Blais.
Canada already has some experience responding to such threats. In 2018, Trump’s administration announced it would impose tariffs on steel and aluminum imports and Canada imposed similar trade countermeasures on carefully selected U.S. products.
Keller said the Canadian tariffs were targeted to hurt select politicians at a local level.
One of those products was Kentucky bourbon, which was meant to target the leader of the Republicans in the Senate, Mitch McConnell, from Kentucky, in hopes that he would increase the pressure on Trump to back away from the tariffs. Canada and the U.S. came to an agreement to end those tariffs nearly a year later.
CUSMA REVIEW
A Trump administration will want to take a new look at CUSMA when it is scheduled for a review in 2026, and all bets are off as to which trade irritants could be on the table. Blais said it is not out of the question that Americans would use the threat of tariffs as a leverage in the discussions and conversations around the deal.
“We know that they disagree with the interpretation of the deal as it is made on rules of origin for automotives and we know that they’re still unhappy with our supply management on dairy, and now they’re really unhappy on the DST (Digital Services Tax),” said Blais.
The Canadian Senate is in the final stages of studying a Bloc Québécois bill that would protect farming sectors under supply management from future trade negotiations.
Boehm, who is chair of the Senate committee on foreign affairs and international trade, would not comment on that specific matter. But he has previously said in committee he opposes the bill as it would divide the agricultural community and would have implications for future trade negotiations, particularly the upcoming review of CUSMA.
The former diplomat however said tough talk during trade negotiations go both ways between Americans and Canadians.
“They’re always tough when they negotiate trade deals, and they are particularly tough with us, because they know that we’re tough too,” said Boehm.
DEFENCE SPENDING
Former U.S. ambassador to Canada Kelly Craft, who served under Trump, recently warned that Canada needs to spend more on defence, faster, if Trump becomes president.
Following years of pressure from allies, Canada committed to reaching NATO’s spending target of two per cent of GDP on defence by 2032. The original deadline, which all alliance members including Canada agreed to in 2014, was to reach that goal by this year.
Blais said that while Trump has been more outspoken about it when he was in the White House, European allies have since stepped up and increased their defence spending.
“I think we have to understand the world is not a friendly place,” said Blais. “We need to protect our borders, and there are ways to do it in a way that we can actually boost our economy. So just we have to get the best minds around the table.”
But adding billions to Canada’s defence budget is easier said than done. Keller said that no matter if it’s a Liberal or Conservative government, getting to that threshold would require a massive amount of spending. He also said there are many structural issues that would make it difficult to attain, including the Canadian Armed Forces’ lack of recruitment.
“If we go ahead and meet the two per cent procurement total over a short period of time, who’s going to operate all that equipment?”
IMMIGRATION POLICY
Trump has promised a sweeping overhaul of U.S. immigration policy if he wins, including mass deportations of millions of people and more resources at the U.S.-Mexico border.
Boehm said that the mass deportations strike him as “totally unworkable” and gave the failed example of the United Kingdom which tried to send illegal immigrants and asylum seekers to Rwanda. Ultimately, the Conservatives were defeated during this year’s election and the Labour Party announced that the Rwanda plan would be cancelled.
“How are you going to convince another country to simply take people that you are deporting?” asked Boehm.
It seems unlikely however that Prime Minister Justin Trudeau will send out another tweet welcoming those fleeing war and persecution, as he did in 2017 after Trump issued a travel ban on Muslim-majority countries. That led to thousands of people crossing Roxham Road at the Canadian border in hopes of claiming asylum. Roxham Road has since been closed.
Keller said the Canadian government is probably preparing for another influx at the border.
“How the government is prepared to deal with that is the big question. We haven’t heard anything yet and I don’t blame the government for keeping those keeping that quiet in advance of the run-up to the election, but I think it’s a live issue,” he said.
FOREIGN AFFAIRS
It is unclear how Trump would end Russia’s war on Ukraine in “one day,” as he has repeatedly claimed he would do.
Boehm said that would mean Ukraine would surrender some territory to Russia. “In terms of my foreign policy experience, the only way to end that… is through an enforced peace that would let Russia keep the territory that it has, which is anathema to what Ukraine wants, what NATO wants, and certainly what the European Union wants,” he said.
If that happens, Keller said Canada could be called on by its European allies to play a bigger role financially to defend Ukraine or play a whisper campaign to try to convince Trump otherwise.
“Let’s not forget, (former U.S. President Barack) Obama basically did that with Crimea” said Blais. “There is a precedent, and the war will have to end at some point. And how it ends remains to be seen.”
Obama has previously defended his response to Russia’s annexation of Crimea in 2014, saying that circumstances were different than Russia’s current invasion of Ukraine.
As for the Israel-Hamas war, Trump would continue to be “very supportive” of Israeli Prime Minister Benjamin Netanyahu, having hosted him at his Mar-A-Lago estate in Florida earlier this year.
National Post
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