The game plan for what U.S. President Donald Trump has dubbed “Liberation Day” is being flipped on its head.
What happened: Trump is reportedly narrowing the scope of the reciprocal tariffs that are slated to come into effect on April 2. Instead of hitting all countries, the tariffs are now expected to focus on the 15% of nations that have the largest trade deficits with the States.
- According to the Wall Street Journal, these targeted nations — referred to as the “Dirty 15” — will be hit with significantly higher tariffs than previously expected.
- Trump said on Monday that the U.S. would also be moving forward with industry-specific tariffs on pharmaceuticals, vehicles, and aluminum soon.
Why it matters: This new approach by the White House could spell bad news for Canada, which — as one of the countries that runs a significant trade surplus with the U.S. — could face steeper tariffs, all while other countries are potentially let off the hook.
- CIBC economist Avery Shenfeld claimed in a report that Ottawa’s odds of negotiating a settlement would be better if other U.S. trading partners faced similar tariffs.
- He argues that wide-ranging measures would at least put Canada on an even playing field, rather than Canadian exports facing tariffs that other countries’ goods aren’t.
Big picture: Despite the reprieves over the past two months, Canadian officials have reportedly been told there is no way to avoid whatever tariffs are coming down the pipeline on April 2.—LA