Canada’s trade chief warns that oil and gas exports could take a hit

When the president is elected Donald Trump fulfills his threat impose tariffs on Canadian goodsCanada’s International Trade Minister Mary Ng said Thursday that Ottawa is prepared to retaliate with tariffs that could target the energy sector.

“Everything is on the table,” Ng told a global markets reporter Seema Modi on CNBC’s “Rumble on the Street.”

This includes dollar-for-dollar reimbursement. Canada’s trade chief also refused to rule out an export duty Canadian Oil and Gas heading to the United States.

“I don’t really think the Americans want us not to sell electricity, oil and gas to America, because you know, I’m here in New York, lights on Broadway, a lot of Canadian electricity,” said Ng.

“If you’re going to put tariffs on Canada, it’s going to make things more expensive for Americans,” she added.

Trump threatened a 25% full tariff on all Canadian exports if he takes office Monday. The threat is similar to that of Mexico, a trilateral party to the USMCA trade agreement. Trump also talked about raising tariffs on Chinese imports by 10%.

Canada and the United States have a trade relationship that is virtually unparalleled. In 2022, Canada was the first largest buyer of American goods and the third largest exporter of goods to the United States

Ng and her team are currently compiling a list of US exports to Canada that could face additional tariffs if trade tensions escalate. “Everything will be on the table,” she said.

The same goes for Canadian goods entering the US.

“You can be sure that when you buy something (at) the supermarket … think about candy. There’s probably a Canadian there. So if you pay $4 today, you may pay $5 tomorrow. ” – said Ng.

The potential threat of a trade war with the United States also forces Ottawa to continue engaging with its remaining trading partners around the world, including Japan and the European Union.

“I’ve always had a mandate as Canada’s Department of Commerce to diversify,” Ng told CNBC. “It’s great for us to work with America, but certainly we should also look for opportunities around the world. And we do it.”

This is not the first time Trump has used tariff threats to restart trade talks with America’s northern neighbor.

During his first term, Trump imposed tariffs on Canadians export of steel and aluminum in the USA

The move prompted Ottawa to announce retaliatory charges on American products such as beef, chocolate, ketchup and others.

At the time, Canada made no secret of it selection criteria for which American exports will be hit with additional tariffs. Prime Minister Justin Trudeau’s government has deliberately chosen products from powerful political places both battlefield states and those with powerful representatives in Congress.

The idea was that any adverse economic effects from falling exports would be felt most acutely by people in the communities that produced or grew the produce. They, in turn, will put additional pressure on their elected representatives in Washington – including Trump, who is running for a second term – to defuse tensions.

This time, Ng said Canada is looking to “find more points of contact” before any escalation. She also said Ottawa is working to improve the security of the US-Canada border. This could help Trump fulfill a key promise he made on the campaign trail.

“I think we have a unique opportunity now for Canada and the United States to build an even stronger economy, a strong North American economy, by working together,” Ng said.

Expanding that cooperation could include purchases in the U.S., said Kirsten Hillman, Canada’s ambassador to the United States. Associated Press on Monday. Seventy percent of Canada’s military equipment is purchased from the United States, Hillman said.

When it comes to buying more military equipment, “everything is on the table,” Ng told CNBC, from fighter jets to drones.

Canada is currently in the midst of a leadership transition. Prime Minister Justin Trudeau resigned earlier this month. Trudeau’s resignation comes just weeks after his former ally and deputy prime minister Christia Freeland also resigned.

U announcing his resignationFreeland, who was also the country’s finance minister, cited disagreements with Trudeau over the direction of Canada’s trade policy toward the United States.