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President Donald Trump talks with Canada's Prime Minister Justin Trudeau during a North Atlantic Treaty Organization Plenary Session at the NATO summit in Watford, Britain, in December 2019.
Mexico, Canada get tariff reprieve
On Thursday, US President Donald Trump announced a one-month tariff reprieve on all Mexican and Canadian goods governed by the USMCA, as well as potash,until reciprocal tariffs are imposed worldwide on April 2.Canada supplies 80% of US potash, a critical component of fertilizer. The decrees follow Wednesday’s one-month tariff reprieve for America’s Big 3 automakers: Stellantis, Ford, and General Motors.
What will be tariff-free? According to senior administration officials, 50% of goods entering the US from Mexico and 38% of goods from Canada would qualify. Some Canadian energy products will still be subject to a 10% tariff, and some Mexican products, like computers, will still face a 25% tariff.
How have Canada and Mexico responded? Mexican President Claudia Sheinbaum had not imposed tariffs but was set to announce them Sunday if no deal was reached.
Canada’s initial set of tariffs on $30 billion in American goods imposed on Tuesday will remain. A second wave of $150 billion set to take effect after 20 days has reportedly been suspended until April. Ontario Premier Doug Ford also said that Canada would be imposing a 25% tariff on electricity exports starting Monday, regardless of whether tariffs would be lifted. Canadian provinces have also removed US-made alcohol from store shelves and barred American firms from procurement contracts, and there is no sign that this measure will be reversed.
Why did Trump change course? Trump said “I wasn’t even looking at the market” but major stock indexes plummeted this week, as investors were spooked by the uncertainty. In the Oval Office, Trump said “This is about companies and countries that have been ripping off our country and they won’t be ripping off our country anymore.”
Trump’s reprieve on Mexico specifically mentioned actions taken to stem the flow of illegal aliens and fentanyl into the US. This contrasts with his conversation Wednesday with Canadian Prime Minister Justin Trudeau in which Trump claimed Canada’s efforts on fentanylwere insufficient to drop US tariffs.
But the US president has citedother reasons for tariffs on Canada, including accusing the country of not allowing US banks to operate there and falsely claiming that the US “subsidizes” Canada to the tune of $200 billion a year. Commerce Secretary Howard Lutnick alsoaccused Canada of having a “national tariff” on US products because it has a 5-15% federal-provincial sales tax.Trump grants some tariff relief – but it’s temporary
US President Donald Trump gave America’s Big Three automakers a one-month tariff reprieve but expects them to use the time to shift production from Canada and Mexico to the United States. White House Press Secretary Karoline Leavitt announced the temporary exemption Wednesday after Trump held a call with the CEOs of Stellantis, Ford, and GM, at their request. Levitt also made it clear that, as of April 2, reciprocal tariffs will go into effect worldwide.
What are they? In a nutshell, Trump will slap tariffs on other countries that match the tariffs those countries place on the US.
Which countries would be most affected? India, Argentina, South Korea, and Brazil had the highest tariff regimes as of 2023. India recently cut levies on many US imports, including motorcycles, but still has tariffs on imported cars of up to 110%, leaving small exporters demanding further reductions from Delhi. Argentinian President Javier Milei recently praised Trump’s plan for reciprocal tariffs and said he wants to pursue a reciprocal trade pact, even if it means leaving the Mercosur trade pact with neighboring South American countries.
Will Trump reverse course? It’s possible but unlikely. Trump has long been a believer in tariffs. In his address to Congress on Tuesday evening, he said “Tariffs are not just about protecting American jobs. They’re about protecting the soul of our country.”Staff remove bottles of US alcohol from the shelves of a Liquor Control Board of Ontario store as part of retaliatory moves against tariffs announced by President Donald Trump, in Toronto, Canada, on March 4, 2025.
Canada, Mexico, and China retaliate against Trump’s tariffs
It’s official: The United States is now waging a full-blown trade war against three of its largest trading partners. On Tuesday, Washington imposed tariffs of 10% on energy and 25% on all goods imported from Canada and Mexico and doubled its existing tariffs on Chinese imports from 10 to 20%. All three countries responded with harsh words and retaliatory measures.
Canada imposed an immediate 25% retaliatory tariff on $30 billion worth of US goods, with an additional $125 billion worth of products to be tariffed in 21 days. Provincial liquor stores removed American alcohol and Ontario Premier Doug Ford ripped up a $100 million contract with Elon Musk’s Starlink. Ford alsothreatened a 25% retaliatory tariff on electricity exports. Canadian Prime Minister Justin Trudeau called the tariffs “dumb,” prompting US President Donald Trump to repeat his taunt of “Governor Trudeau” and promiseeven higher tariffs in response to retaliatory efforts.
Mexico’s President Claudia Sheinbaum took a slower approach. “We have said it in different ways: cooperation and coordination, yes; subordination and interventionism, no,” she said. Sheinbaum plans to speak with Trump by phone on Thursday and will announce retaliatory measures on Sunday if no deal is reached.
China, meanwhile, placed an additional 10% to 15% tariffs on imported US goods, including chicken, wheat, soybeans, and beef as of March 10. Beijing says it will “fight to the bitter end of any trade war” but left the door open for talks, advising the US to “return to the right track of dialogue and cooperation before it is too late.”
The tariff war had immediate economic effects.Markets plunged, the price of a Dodge Ram truck reportedly rose from $80,000 to $100,000, and by mid-March American gas prices could rise by as much as40 cents per gallon, while Ford said the auto manufacturing sector in Canada could shut down.
Could Trump change course? We’ll be watching for further market volatility as well as blowback from consumers, businesses, and politicians. But stay tuned for a possible course correction: US Commerce Secretary Howard Lutnick already hinted Tuesday that Trump is considering “relief for USMCA-compliant goods” and “may roll back Canada and Mexico tariffs tomorrow.”
What does Trump’s critical minerals play in Ukraine have to do with Canada?
After softening its demands, the US has secured a critical minerals development deal with Ukraine, whose president, Volodymyr Zelensky, is planning to visit Washington on Friday. The US had initially demanded $500 billion in critical minerals for jointly developing critical these resources, and, ostensibly, repaying the country for money sent to Ukraine to aid it in its defense against Russia. Ukraine hopes the deal will ensure future military funding assistance from the US, which has been thrown into doubt since Donald Trump came to office. (Read our explainer on rare earths here.)
Closer to home, as Trump threatens Canada with tariffs, there’s growing concern that the president’s ultimate aim – aside from possibly annexing the country – is gaining control of Canadian critical minerals and rare earths. These resources, which include lithium, cobalt, copper, graphite, and more, are essential to several industries and products, including electric vehicles, cell phones, computers, and military hardware, making them not just essential to the economy, but to national defense, too.
In Canada, concern over critical minerals played a notable part in the Liberal Party’s English-language leadership debate on Tuesday night, as candidates to replace outgoing Prime Minister Justin Trudeau spent much of the evening talking about threats from the US. Presumptive frontrunner Mark Carney said Canada ought to leverage its critical minerals to deal with Trump and strengthen the Canadian economy, while Parliament member and Cabinet minister Karina Gould warned that Trump’s focus on Canada was expressly tied to a play for those resources. The growing focus on economic and domestic security in the US means we could be hearing a lot more about critical minerals and rare earths in the weeks and months to come as the president refines his demands from Canada.President Donald Trump meets with Canada’s Prime Minister Justin Trudeau in a bilateral meeting at the G7 Summit in Charlevoix, Quebec, back in June 2018.
Will the Five Eyes become Four Eyes?
This week, Canada and the global intelligence community were shocked and concerned at the suggestion that the White House was considering removing Canada from the Five Eyes intelligence alliance. On Tuesday, The Financial Times reported that Donald Trump’s trade and manufacturingadviser Peter Navarro, a trusted consigliere to the president, was lobbying the administration to kick Canada out of the intelligence-sharing group, which also includes the United Kingdom, Australia, and New Zealand.
Navarro was quick to deny the reports, calling it “crazy stuff,” and adding “We would never, ever jeopardize our national security ever with allies like Canada. Ever.” But the FT, which stands behind its reporting, has sources in the administration who say Navarro’s threats to cut Canada out of the Five Eyes alliance is a tactic for pushing the country to fall in line on Trump’s demands on trade, border security, and defense spending.
CTV News reporter Stefanie Ha spoke with former Justin Trudeau national security and intelligence advisor Vincent Rigby, who said the Five Eyes threat could indeed be a “pressure point” the Trump administration is exploiting, similar to a tactic the president used during his first term by threatening to withhold intelligence from Canada.
Graphic Truth: Freedom for Quebec?
According to a recent Leger poll, 27% of Canadians see the US as an “enemy,” and there is nothing like a common enemy to spread unity. As Donald Trump’s threats against America’s northern neighbor ignite Canadian patriotism, the number of French-speaking Quebecois wanting sovereignty has declined. In fact, it fell six points during Trump’s first two weeks in office.
French-speaking Quebecois have always seen themselves as a distinct nation within Canada. Back in 1995, when Quebec held its last referendum on sovereignty, the vote was razor-thin — 50.6% voted to stay in Canada, and 49.4% wanted out.
Fast forward to today, and the independence movement is weaker than it was in the 1990s. Globalization, generational shifts, and an increasingly multicultural Quebec have changed the game. Younger Quebecois, even if they support more autonomy, aren’t as invested in full separation. Plus, economic fears about losing access to Canada’s federal transfers, an uncertain currency future, and the risk of companies relocating to Toronto or Vancouver have made the cost of sovereignty too high for most voters.
This has only been compounded under the new US administration, as Trump’s tariff threats, and hints at absorbing Canada into the US, have jeopardized Canada’s economy and security, resurging Canadian pride and unity.
Graphic Truth: Corruption in Canada and the US
The United States is larger, more powerful, and — these days — unfriendlier than Canada. But it’s also seen to be way more corrupt. According to Transparency International’s latest Corruption Perceptions Index, Canada ranks as the 15th most transparent government in the world. The US, meanwhile, languishes at 28th.
But both countries have seen industry and expert perceptions of transparency and the rule of law deteriorate steadily in the 13 years that the study has been done. The US notched its lowest-ever score in the new report, partly based on perceptions of declining ethical standards in the judiciary during the Biden administration. Here’s a look at how Canada and the US have stacked up on the index since its inception in 2012.
Trump brings Canadian Liberals back from the dead
Mark Carney laid out his case for governing Canada on Saturday during a friendly interview with former Tony Blair spin doctor Alastair Campbell and short-lived Trump spokesman Anthony Scaramucci on "The Rest Is Politics" podcast.
Carney is likely to become leader of the Liberal Party of Canada on March 9 and then take over from Justin Trudeau for two weeks before calling an election in which he must convince Canadians that he, not Pierre Poilievre, is the right person to handle President Donald Trump.
He is taking a harder line than the Conservative leader.
“What had been our closest friend and ally now is just our neighbor,” he said. “The Americans are just our neighbor. It’s geography as opposed to kinship.”
In a flag-festooned rally in Ottawa on the same day, Poilievre struck a different tone. He said Canada “will bear any burden and pay any price to protect our sovereignty and independence” — while also extending an olive branch.
“We’ve always loved you as neighbors and friends. There is no country with whom we would rather share a border — the longest undefended border in the world.”
Not a professional politician
Poilievre is not free to take as hard a line as Carney because about half of his party’s supporters approve of Trump, and his approach to politics is influenced by the MAGA movement.
Carney attacked Poilievre for that in the podcast.
“Do you really believe in these elements of Canada, or have you been mouthing MAGA talking points with a Canadian twist for the past three years, and don’t buy into them and wouldn’t protect them?”
Campbell, a savvy political messenger, gave him some friendly advice.
“I think if you are a full-time experienced politician, you left that hanging, Mark,” he said. “I’d have gone straight for the jugular. You were setting it up and then you pulled your punch.”
“You’re right,” Carney said with a grimace and a smile. “Fair enough.”
Campbell, who wants Carney to win, is right. Carney is not a “full-time experienced politician.” He doesn’t know how to land a punch. Poilievre, in contrast, has an unerring instinct for his opponent’s weaknesses, and never misses an opening.
No longer a slam dunk
The election ahead was supposed to be a slam dunk. Poilievre has been leading in the polls for three years, usually by double digits. The 9-year-old Trudeau government had wandered to the left of the mainstream, leaving Canadians fed up with the cost of living, a housing crisis, mismanaged immigration, and an activist, woke approach to social issues.
All the pieces were lined up for a massive Conservative election victory until Trump started threatening to annex Canada. In the fallout, the unpopular Trudeau was forced to resign, and Carney — who had been biding his time on the sidelines — stepped forward.
The former governor of central banks in Canada and the UK, Carney has unparalleled economic and crisis-management credentials. Canadians have taken notice. He is raising money and filling halls. The one issue where the Liberals have a brand advantage — managing the relationship with the Americans — is now likely to dominate political debate.
New challenge for Poilievre
Poilievre is still ahead in the polls, but the Liberals have surged. A poll last week from Leger, Canada’s best-rated pollster, found that the electorate would be evenly divided when Carney is leader.
The result was not a complete shock to Leger because a poll the week before found Quebec’s leaderless provincial Liberals surging at the expense of nationalist Quebec parties, says Leger Vice President Sébastien Dallaire.
“There clearly is a generalized Donald Trump effect, so the voters are galvanizing, trying to show national unity against what’s happening in the United States, against Donald Trump more specifically, and parties whose brands are more aligned with defending national unity are certainly benefiting from this.”
Poilievre had planned for the election of 2025 to be a referendum against Trudeau and the carbon tax, but Trudeau is headed for the exit and Carney has promised to kill the consumer carbon tax.
The parties are converging on policies as Liberals discard unpopular Trudeau-era positions and wrap themselves in the flag after a decade in which they held more ambiguous feelings. Poilievrecan complain about their death-bed conversion, but voters are focused on the future, so he has to thread the needle, backing his country against American threats while also not sanctioning the Liberals’ response.
“You want to be heard, but you don’t want to be seen to be a bit tone-deaf or out of touch with what’s happening,” says Dallaire. “So that’s the big, big challenge for Pierre Poilievre right now. And it goes a little bit against his style of politics as well, to find that softer tone a little bit.”
Trump, who seems to despise Trudeau, has thrown the Liberal Party a lifeline — and increased the possibility that the United States will face an unfriendly new government on its northern border this spring.