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(Reuters) – Canada could face long-term political challenges with the United States even if it manages to avert U.S. President Donald Trump’s threat of tariffs, Prime Minister Justin Trudeau said on Friday.
Trump on Monday said he would delay the imposition of tariffs on Canadian exports by 30 days in return for concessions on border and crime enforcement, in particular cracking down on fentanyl smuggling.
Trudeau said Ottawa’s immediate challenge was to persuade Washington that Canada was doing all it could to combat the flow of fentanyl. Public data shows 0.2% of all the supply of the drug seized in the U.S. comes from the Canadian border.
If tariffs were imposed, Canada would respond in kind, but its goal would always be to have the measures removed as fast as possible, Trudeau told business and labor leaders at the start of a meeting on how to diversify trade and boost the economy.
“The strategic reflection we have to have right now is… how we get through, and thrive, and grow stronger over the next four years and into what may be a more challenging long-term political situation with the United States?” he said.
Trump has repeatedly suggested Canada would be better off if it agreed to become the 51st U.S. state.
Peter Navarro, a senior Trump trade adviser, this week said Canada had become a leading source of small, duty-free shipments of drugs, also had “big” visa issues and had let people on the “terrorism watch list” enter the United States.
Canada sends 75% of all goods and services exports south of the border, making it highly vulnerable to U.S. sanctions.
Trudeau, echoing long-standing complaints from the business community, said internal trade barriers between the 10 provinces were hampering the economy.
“This is one of those moments and opportunities where… there’s a window open because of the context we’re in. We have to jump through it,” he said.
Before Trump lifted his tariff threat, Canadians canceled trips south of the border, boycotted U.S. alcohol and other products and even booed American teams at sporting events.
Trudeau, who made his comments in front of a huge Maple Leaf flag, said it was “quite frankly, inspiring” that people were moving to buy Canadian products and vacation at home.
Reporting by Nivedita Balu, writing by David Ljunggren Editing by Marguerita Choy
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