OTTAWA – Prime Minister Mark Carney has the support of most Canadians after breaking off trade talks with the U.S., but widespread approval of his pushback against U.S. President Donald Trump could disappear within months as the consequences of the trade war sink in.
Carney’s negotiating position could also weaken if Republicans retain power in Congress after November U.S. midterm elections and reinforce American protectionism under Trump. Carney is one of the few global leaders to retaliate against U.S. tariffs, despite Canada’s dependence on U.S. buyers for about 70% of its exports. On Tuesday, his government announced dollar-for-dollar counter-tariffs on $20 billion of U.S. goods, as well as a C$7.5 billion ($5.41 billion) package of economic support measures.
“Carney’s leverage will start to diminish if this escalating trade war starts to show up in palpable increases in unemployment, factory shutdowns and declining income,” said Julian Karaguesian, a former adviser at Canada’s Finance Ministry and economics professor at McGill University. “Canada cannot win an economic war of attrition with the U.S.”
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