TORONTO – The inauguration of the “new” American President came and went January 20, but the much feared imposition of a 25% tariff on Canadian goods and services did not materialize. What Trump di deliver was a directive to the pertinent departments of US government to provide his office with a complete analysis of Acts, Regulations and Outcomes of initiatives impacting on economic programs affecting Canada-USA relations. By April 1, 2025.
His pre-inauguration “threats” were not all bluster. On the issue of Diversity, Equity and Inclusion (DEI), his Executive Orders were rather unequivocal: they DEI is no more; no more funding and staff associated with it are advised of a two-step project, (1) immediate lay-off with pay and (2) eventual dismissal. The “dynamic” is petering out as resources are shut down.
For commerce and trade-related industries such measures may be as improbable as they are impractical, despite the “gloom and doom” of some our Federal politicos desperate for a straw man to serve as a distraction from other political realities.
It is all about the money. The [American] Official Website of the International Trade Administration (ITA) (1/22/25) offers this clue: “Canada is traditionally the top U.S. export market, accounting for 14.2% of all U.S. goods exports in 2022”.
The ITA further advises that bi-lateral trade amounts to “US $2.5 billion in goods and services daily [… and] totaled US$919.2 billion in 2022 […] while bilateral investment stock totaled US$1.027 trillion.” The trajectory is upward.
In fact, “thirty-four U.S. states rank Canada as their number one export market, and Canada serves as either the first or second export market for 45 U.S. states. In 2022, U.S. exports to Canada exceeded total U.S. exports to Denmark, France, Germany, Italy, Spain, and the United Kingdom combined.”
The USA are nothing if not about facilitating commerce (making money). Canada is already in an economic union, Continental economy, with the USA and Mexico. That relationship is valued at more that our nominal GDP.
Other gems the ITA presents to its entrepreneurial readership point to the variety and profitability of the products at play. “In 2022, U.S. exports of goods to Canada totaled US $357.3 billion”. Top export categories to Canada included: vehicles (US$53.8 billion); nuclear reactors, boilers, machinery (US$49.7 billion); mineral fuel, oil (US$35.3 billion); electric machinery (US$28.3 billion); and plastics & plastic articles (US$17.7 billion). (see trade.gov/ for a more complete list)
On the Investment side (FDI), the bilateral relationship is even more impressive. At US $683.80 billion in 2022, Canada was the United States’ second-largest source of FDI. The investment stock from the United States totaled US$438.76 billion. As of 2020, U.S. affiliates of Canadian-owned firms employed 844,600 Americans.
If our putative negotiators are allowed to climb of the ledge, we may see that our bargaining position is quite strong.
