Canadian Prime Minister Justin Trudeau announced Thursday that he is re-establishing a special Cabinet committee on Canada-U.S. relations to address concerns surrounding the potential impact of another Donald Trump presidency. Trudeau’s decision comes in response to Trump’s recent re-election, as Canada prepares to navigate potential challenges in its most critical bilateral relationship.
Deputy Prime Minister Chrystia Freeland, who also serves as the country’s finance minister, will chair the committee, which will include other senior officials, such as the ministers of foreign affairs, public safety, and industry. Trudeau’s office stated that the committee’s focus will be on critical Canada-U.S. issues, reflecting the need to proactively address challenges that could arise from Trump’s return to the White House.
Canada’s economy is deeply connected to the United States, with 75% of its exports destined for its southern neighbor. During Trump’s first term, his administration’s push to renegotiate the North American Free Trade Agreement (NAFTA) and his threats of a 25% tariff on Canada’s auto industry brought significant uncertainty to the Canadian economy. The resulting United States-Mexico-Canada Agreement (USMCA), which replaced NAFTA, maintained key trade ties but underscored the fragility of Canada’s economic reliance on the U.S.
In a call with Trump on Wednesday, Trudeau offered his congratulations and discussed the renewed USMCA, a testament to the two countries’ complex but vital trade relationship. Trump, who previously referred to Trudeau as “weak and dishonest,” maintains a complicated rapport with Canada, but the countries’ economic ties remain among the closest globally.
Freeland spoke to reporters twice on Wednesday to reassure Canadians, acknowledging their concerns over Trump’s return but emphasizing Canada’s strong position. “I know a lot of Canadians are anxious,” Freeland said. “I want to say with utter sincerity and conviction to Canadians that Canada will be absolutely fine. We have a strong relationship with the United States, and we have a strong relationship with President Trump and his team.” She also highlighted the resilience of the USMCA, a deal negotiated under Trump’s leadership, as a foundation for stability in the countries’ trading relationship.
Throughout Trump’s recent campaign, he hinted at imposing new tariffs, ranging from 10% to 20% on foreign goods, with some rhetoric suggesting even higher rates. Political experts like Nelson Wiseman, a professor of political science at the University of Toronto, anticipate that Canada may face renewed pressure to increase its defense spending, an issue Trump raised during his previous presidency. Canada’s defense budget, estimated at 1.33% of GDP in 2023, falls below the 2% NATO target that Trump has long urged allies to meet to reduce U.S. financial burdens within the alliance.
“I expect that the free trade deal will be slightly modified as it was during Trump’s first presidency and not dramatically,” Wiseman said. “Tariffs will hurt the Canadian economy, but not cripple it. Canada has some cards to play in negotiations, including countervailing tariffs, the concerns of American business leaders, and Canada’s storehouse of critical minerals.”
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Trade remains a cornerstone of the Canada-U.S. relationship, with nearly CA$3.6 billion (US$2.7 billion) in goods and services crossing the border daily in 2023. Additionally, defense, border security, and law enforcement cooperation underscore the unique partnership between the two countries, which is enhanced by a vast cultural overlap that includes shared sports leagues and media influences. Daily border crossings by approximately 400,000 people and an estimated 800,000 Canadians living in the U.S. reflect the countries’ interconnected societies.
Robert Bothwell, a Canadian history and international relations professor at the University of Toronto, believes Canadians should brace for Trump’s unpredictable approach, particularly on tariffs and trade. “How would you feel if old Uncle Donald was feeling whimsical one morning and decided to do, oh, whatever he’d just heard on Fox News?” Bothwell mused, suggesting that Trump’s impulsive decision-making could lead to sudden shifts in U.S. policy impacting Canada.
As the Cabinet committee prepares to meet, Trudeau’s government remains committed to working with the U.S. to maintain a mutually beneficial relationship. However, officials understand the importance of preparing for potential policy shifts, including any new tariffs or trade regulations that might emerge under Trump’s leadership.
For Canadians, the renewed focus on U.S.-Canada relations signals the government’s awareness of potential volatility. As Canada continues to strengthen its trade ties, defense collaborations, and diplomatic channels, the Cabinet-level panel represents an effort to safeguard Canadian interests in a time of renewed uncertainty.
