A Trade War 𝘗𝘢𝘶𝘴𝘦𝘥, But Not Resolved
As part of his “America First” agenda, on February 1, 2025, U.S. President Donald Trump introduced sweeping 25% tariffs on Canadian goods and 10% tariffs on Canadian energy exports entering the United States. Canada reacted with its own list of retaliatory tariffs. However, the justifications for these measures have continued to shift. Initially framed as a response to trade imbalances, the Trump administration has since linked the tariffs to Canada’s defence spending, border security concerns, and fentanyl trafficking.
However, in a dramatic turn of events, President Trump and Prime Minister Justin Trudeau reached an agreement on February 3, 2025, to delay the implementation of the tariffs for 30 days, pushing the deadline to March 4, 2025. This decision followed an extensive discussion between the two leaders, during which Canada committed to an enhanced $1.3 billion border security package aimed at addressing U.S. concerns.
Trudeau announced that Canada will deploy nearly 10,000 additional personnel to bolster border security, increase cooperation with U.S. agencies, and launch a Canada-U.S. Joint Strike Force to combat fentanyl trafficking and organized crime. In exchange, Trump has agreed to pause tariffs on Canada while both sides negotiate further measures.
While this delay offers a temporary reprieve, it does not resolve the underlying trade tensions, and businesses remain on high alert. This briefing outlines Canada’s evolving response, ongoing provincial measures, and potential next steps.
Federal Government Response: Trudeau’s Border Commitments
Prime Minister Justin Trudeau framed the 30-day tariff delay as a win for Canada, emphasizing that border security enhancements will not only address U.S. concerns but also strengthen Canadian sovereignty.
“I just had a good call with President Trump. Canada is implementing our $1.3 billion border plan—reinforcing the border with new choppers, technology, and personnel, enhanced coordination with our American partners, and increased resources to stop the flow of fentanyl.”
Key Elements of Canada’s Border Security Plan
Deployment of 10,000 new personnel to border security and law enforcement operations.
Creation of a Fentanyl Czar to oversee efforts in dismantling transnational drug cartels.
Listing cartels as terrorist organizations to allow for stricter enforcement measures.
Installation of new border surveillance towers and scanning technology at key crossings.
Launch of a Canada-U.S. Joint Strike Force to combat fentanyl smuggling, organized crime, and money laundering.
$200 million in new intelligence operations focused on international criminal networks.
Trudeau stressed that these measures were in Canada’s national interest, independent of U.S. trade policies. However, critics, including Conservative Leader Pierre Poilievre, argue that the government was forced into action by Trump’s aggressive approach rather than implementing these measures proactively.
Canada’s Retaliatory Tariffs: Still on Standby
Despite the temporary reprieve, Canada’s retaliatory tariffs remain on the table should the U.S. proceed with its trade measures on March 4, 2025. Finance Minister Dominic LeBlanc reiterated that if tariffs go into effect, Canada will immediately impose 25% tariffs on $30 billion worth of American goods, with a second phase targeting $125 billion to follow. The new March 4, 2025 deadline is just less than a week before the Liberal party will choose their next leader, and in turn Prime Minister, on March 9, 2025.
Pierre Poilievre’s Plan to Secure Canada’s Borders
Earlier today and prior to the announcement of the 30-day delay, Conservative Leader Pierre Poilievre launched his "Canada First" plan, arguing that Canada’s border crisis should have been addressed long before the U.S. imposed economic threats.
Poilievre’s Six-Point Border Security Plan:
Deploy Canadian Forces to the Border – Troops, helicopters, and increased surveillance immediately.
Increase CBSA Capacity – Hiring of 2,000 new border agents.
Expand CBSA Powers – Officers will have full jurisdiction along the entire border, not just at crossings.
Install Border Surveillance Towers and Drone Systems – Enhanced monitoring for illegal crossings.
Install High-Powered Scanners – New technology at ports of entry to detect contraband.
Track Departures of Foreign Nationals – Ensure deportees do not remain in Canada illegally.
Poilievre criticized Trudeau’s handling of the crisis, stating:
“The Trudeau government ignored border security untilit became a trade issue. These tariffs and threats are unjustified, but Canadamust not rely on U.S. pressure to fix its broken policies.”
Some provincial leaders, including Saskatchewan Premier Scott Moe, have expressed support for integrating CBSA operations into Canada’s NATO spending commitments to secure broader geopolitical benefits.
Provincial Responses: Next Steps in Light of the Delay
Alberta: Energy Under Siege
Premier Danielle Smith had originally planned an emergency cabinet meeting for Tuesday, February 4, to discuss retaliatory options. However, in light of the 30-day delay, the meeting will likely now shift toward contingency measures that could be deployed should tariffs go into effect on March 4, 2025.
Smith has firmly condemned the tariffs, calling them "economically reckless and deeply damaging to both nations." In response, she has proposed:
Accelerating provincial efforts to diversify energy markets beyond the U.S.
Pushing for fast-tracked pipeline approvals to Canadian coastal ports.
Exploring provincial restrictions on oil exports to the U.S. if tariffs proceed.
British Columbia: Aggressive Counter Measures
Prior to the 30-day delay, Premier David Eby had confirmed that BC would aggressively implement retaliatory measures, including:
BC Liquor stores removing all U.S. alcohol from shelves.
Excluding U.S. companies from government procurement contracts.
Manitoba: Hotline and Further Action
Premier Wab Kinew confirmed earlier today that Manitoba would pull U.S. liquor from shelves of provincially run liquor stores. Kinew has also struck aManitoba U.S. Trade Council including leaders from mining, forestry, agriculture, manufacturing and bioscience, as well as Indigenous leadership. Manitoba’s tariff relief hotline will remain active as businesses adjust to ongoing uncertainty.
Ontario: Hitting Pause
This morning, to much fanfare, Premier Doug Ford announced that his government was tearing up a $100 million contract with Starlink in response to the U.S. tariffs.
“Ontario won’t do business with people hell-bent on destroying our economy. ”
Upon news of the 30-day delay, Ford stated the Ontario government would pause its efforts to remove U.S. liquor products from government store shelves, and that the freshly cancelled Starlink deal is now back on.
What Comes Next?
With tariffs now delayed until March 4, 2025, Canada has a critical window to negotiate a longer-term resolution. Trudeau and Trump will continue discussions in the coming weeks, but the likelihood of a permanent tariff exemption remains uncertain.
Will Canada’s border measures satisfy Trump enough to avert tariffs permanently?
Will Alberta take independent action on energy exports if no resolution is reached?
Will the U.S. Congress push back on Trump’s aggressive trade stance?
New West Public Affairs will provide continued updates on this evolving situation. Businesses should remain prepared for potential disruptions, price volatility, and shifting trade dynamics in the weeks ahead.
