Now it is the turn of a trade war! Trump's decisions may prove costly for America, Canada has prepared to retaliate.

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As soon as Donald Trump took power in the country, he started taking steps to implement the policy of 'America First'. Trump has announced that he will impose a 25 percent tariff on goods coming from Canada and Mexico. The reason behind imposing the tariff is said to be to stop illegal migration and drug trafficking.

This decision of Trump has added fuel to the fire of tensions between Canada and America. Canadian Prime Minister Justin Trudeau and Alberta Chief Minister Daniel Smith are aggressive in responding to Trump's decision. Ontario Chief Minister Doug Ford has made it clear that there is every possibility of a trade war now. All three leaders are claiming that Canada has reserves of power and essential minerals. If Trump has to fulfill his promise of a 'booming' American economy, then he needs us.

Even before taking oath, Trump has made several comments about Canada and Trudeau. In his announcement of tariffs, Ontario Chief Minister Doug Ford said that there would definitely be a trade war between Canada and America. If a trade war starts between the two countries, it will not be good for the economy of both countries and China will directly benefit from it. Even though Trump may think that America will not suffer any loss by imposing his tariffs, but it is not so.

America imports things on a large scale from Canada and Mexico. Deterioration of relations with both countries can backfire on America.

What does America import from Canada?

Canada is a supplier of Machinery and Transportation, Mineral Fuels and Lubricants, Manufactured Goods, Miscellaneous Manufactured Goods, Food and Live Animals, Chemicals, Other Goods, Raw Materials and Beverages, and Tobacco to the US.

According to data from the US Trade Representative Office, US trade with Canada was around 908.9 billion in 2022. Of which exports were 427.7 billion and imports were 481.2 billion.

Canadian resolution

The stance of Canadian leaders seems to indicate that Canada has resolved to take every step to protect its economic interests. Ontario Chief Minister Doug Ford said in an interview with the Associated Press, "We are going to use everything in our toolbox to protect our economy."

Trudeau said Canada would retaliate if necessary, but he also said Canada had faced a similar situation before during Trump's presidency and had later successfully renegotiated a free trade agreement.

At the same time, Ford has said that as soon as Trump implements the tariff, he will instruct the Liquor Control Board of Ontario to remove all American-made liquor from the shelves. The relationship between America and Canada is important for both countries. Increased tension with Canada will make it difficult for Trump to move America's economy forward.