Canada braces for US tariffs to continue beyond Trump era, experts say

Canada faces the prospect of a prolonged trade war with the United States, with experts warning that new tariffs are likely to remain a fixture of the economic landscape, even after President Donald Trump leaves office.

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I don’t see this changing any time soon. I don’t think this goes away magically when Trump exits the White House, and so for Canada, it’s wishful thinking to think we can hold our breaths and white-knuckle it for the next 24 or 26 months.

"I don’t see this changing any time soon. I don’t think this goes away magically when Trump exits the White House," said Aaron Ettinger, an associate professor of political science at Carleton University. "For Canada, it’s wishful thinking to think we can hold our breaths and white-knuckle it for the next 24 or 26 months." He stressed that "Canada needs to be prepared for a tariff regime coming from the United States that continues beyond the Trump administration."

The latest round of 50% tariffs took effect after Canada departed the negotiating table. Prime Minister Mark Carney stated that talks collapsed because the U.S. demanded too much while offering little in return, including limitations on Canada's trading partners.

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Canada needs to be prepared for a tariff regime coming from the United States that continues beyond the Trump administration.

For over a year, fluctuating tariff policies and trade negotiations have cast a cloud of uncertainty over the Canadian economy. A July report from Deloitte indicated that Canada's economy was "on pause," with businesses hesitant to invest in expansion or hiring due to the lack of a clear path forward.

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The other way we’ll be able to help a lot of our small businesses is through the BDC, which will have $500 million to support through interest-free loans that will be between $250,000 to up to $5 million. And there will be no repayment, no capital actually to pay back to the BDC for the next 36 months, so after the Trump administration.

In response, Industry Minister Mélanie Joly announced new financial support measures for small businesses. These include $500 million in interest-free loans through the BDC, with repayment deferred for up to 36 months, extending beyond the current U.S. presidential term. Businesses will need to demonstrate that their cash flow is impacted by the tariffs to qualify.

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What businesses will need to show is they only need to show that their cash flow will be impacted by the tariffs.