Canadian Prime Minister Justin Trudeau declared on Tuesday that Canada will not back down in its escalating trade war with the United States, calling US President Donald Trump’s tariffs a “very dumb thing to do.” In response, Trudeau announced 25% retaliatory tariffs on $30 billion worth of US imports.
“The United States launched a trade war against Canada… Canadians are reasonable. We are polite. We will not back down from a fight,” Trudeau said, emphasizing that while he considers Trump a “smart guy,” his trade policies are reckless.
Trump’s endgame? Trudeau alleges annexation motive
Trudeau went further, claiming Trump’s ultimate goal is to see Canada’s economy “collapse” to make annexation “easier.” The explosive remark comes as Washington implements sweeping tariffs—25% on Canadian and Mexican imports and 10% on Canadian energy exports.
Trump, who has previously floated the idea of making Canada the 51st US state, has defended the tariffs as necessary to protect American jobs. However, Trudeau’s comments mark the strongest Canadian pushback yet, suggesting a deeper geopolitical motive behind the economic conflict.
Markets rattle as trade tensions escalate
Global markets reacted negatively, with the Dow dropping over 500 points following the announcement. Economic analysts warn the tariffs could trigger inflation and disrupt North American supply chains. Canada’s countermeasures, set to take effect in three weeks, will target key US sectors, including agriculture and steel.
Meanwhile, Mexico’s President Claudia Sheinbaum vowed to impose retaliatory tariffs, adding another layer to the growing North American trade dispute. Experts say Trump’s moves could push US trade policy back to its most protectionist stance since World War II.
No resolution in sight
Despite diplomatic efforts, neither side appears willing to de-escalate. “Our tariffs will remain in place until US trade action is withdrawn,” Trudeau said.
With both countries digging in, the trade war shows no signs of easing—raising fears of long-term economic consequences for businesses and consumers on both sides of the border.