Canada Fumes, Fears Lost Business With Trump Trade Talks Ahead #CanadaFinance

(Bloomberg) — A last-minute deal to head off a trade war between the US and Canada has given investors a temporary reprieve, but Canadian leaders are warning about the high-stakes negotiations ahead.

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US President Donald Trump and Canadian Prime Minister Justin Trudeau agreed to pause tariffs on a huge array of products on Monday, hours before levies were to come into effect. Trudeau pledged to expand his government’s C$1.3-billion ($907 million) border security plan, including by appointing a “fentanyl czar” and signing an intelligence directive on organized crime.

But that merely kicked the tariff threat 30 days down the road. Trump said the next month will be used “to see whether or not a final economic deal with Canada can be structured.”

Trump has repeatedly said that he finds the trade deficit with Canada unacceptable and that he believes Canada should be a US state. As long as potential tariffs hang over the Canadian economy, economists, businesspeople and government leaders see the risk that investment will be pulled south.

“Mr. Trump’s strategy around this is deliberate: it’s an intention to destroy Canada’s economy and to drive us into becoming the 51st state,” David Eby, premier of British Columbia, told reporters Monday. He called it “reprehensible, inexplicable, and profoundly disappointing, and it makes me and British Columbians and Canadians very angry, because we see what the plan is here.”

Eby and other Canadian politicians said they’ll be ready to retaliate if Trump tries to put tariffs on again. “If this all unravels within 24 hours — it’s hard to imagine that that’s the state of international trade right now, but it is — then we want to be ready to go with additional measures,” the BC premier said.

The episode has jolted Canadians, who have long trusted that trade and security arrangements with the US were relatively safe. The negotiations that led to the US-Mexico-Canada Agreement during Trump’s first term were bruising, but nonetheless led to a deal that enshrined the principle of North American trade with relatively few barriers.

Now the relationship is ruptured — even for conservative-leaning Canadian politicians who may be sympathetic to some of Trump’s views.

Ontario Premier Doug Ford, who’s running for a third term in Canada’s most populous province, was captured on camera telling members of a firefighters’ union: “Election day, was I happy this guy won? 100% I was.” But then, Ford said, Trump “pulled out the knife” and “yanked it into us.”

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