But in Relation to the United States it Will Change Forever.
Extortion by the U.S. Will Lead to Massive, Permanent Changes.
Canada has become somewhat lazy in relation to seeking to diversity its trade. But why would you change your trade relationship and agreements if you had a friend and trusted partner?
You wouldn’t.
Well, as of today, we don’t have one, and we will.
Today, approximately 75-76% of Canadian trade, is with the United States, down from 86% twenty years ago.
As of today, that will begin to change, and as quickly as circumstances allow.
The objective is to reduce Canada’s trade completely, if that were possible, — however realistically changes like that take time, unless of course one partner, — becomes the enemy.
So tomorrow, Canada will begin to cut trade with the U.S., with the objective of reducing it by about half, down to a level of less than 50% of Canada’s foreign trade, which was 76% of Canada’s exports.
And it should begin with cutting those commodities, minerals, goods and services that have the most value, that being Oil, Gas, rare earth minerals, electricity, uranium, cobalt, nickel, etc., etc.
The best opportunity for growth, especially rapid growth, is with the ASEAN nations, and with Mexico and Brazil. At the moment only 9% of Canadian trade is with the fastest growing economies.
A concerted effort to change this will be underway almost immediately, as Trump’s tariffs, being predatory, suggest that Canada can no longer trust or depend on America.
The effect of Trump’s actions will have a significant chill on trade for the U.S. with other democracies as well, as they can see what is likely to occur for their trade relationship with America.
If a psychopath runs through a crowd stabbing people, apparently that results in them taking action. Who knew?
But I digress.
Extortion isn’t too strong a word to use in order to describe Trump’s actions, as Canada thought it already had a strong trade agreement with America and Mexico in the CUSMA and GATT agreements.
Trump, unilaterally, in an attempt to coerce Canada to lower prices for and to America, has essentially broken trade law. There is absolutely no rationale for Trump to impose a tariff on Canadian goods.
It was Trump, himself who signed the deal!
Trump’s supposed rationale is due to both the immigration and fentanyl drug issues. The problem with that argument is that Canada has a minuscule impact on both, as Canada is responsible for less that’s 1% of both problems, corroborated by the responsible American departments own data.
Trump’s lies in relation to Canada treating ‘America Unfairly’ is based on a treaty that Trump himself claimed, was the ‘greatest trade agreement ever,’ when he, personally signed it. So, either Trump is a liar, or he was a dishonest broker.
But are we surprised? This is a guy who told people to consider injecting chlorine into their bodies, so…there’s that.
Trump’s intent is simply predatory. He will either damage Canadian exports or force through extortion, Canada to seek joining the United States.
The problem with that strategy is that it’s insane. Sorry, insane and irrational.
Canada will not be extorted. Not only will it fight tariffs strategically, but it will result in Canada seeking to create new trade relationships and agreements with China, Japan, Vietnam, Malaysia, Thailand, Indonesia, India, Korea, Singapore, as well as Australia and New Zealand.
Will that be more expensive? Undoubtedly, — but economy of scale, and resource depletion. globally, will level the playing field and compensation over time.
In the South, Canada will seek a much larger bilateral trade agreement with Mexico and Brazil. Two of the fastest growing nations.
And while, again, it will take time, Canada’s determination to move away from America’s sphere of influence will be resolute. This breach of trust will have significant impacts for America as well.
Especially in the long term.
Just one example is that America has a strategic oil reserve that it is estimated will only last for 4.9 years of current production and consumption. Canada’s reserves will last 188 years.
Canada will likely seek much closer ties with the EU and the UK. Historically harder to integrate, not being a member of the EU, Canada may well seek a new status and relationship with the EU and the UK in any event.
Canada’s vast mineral and fossil fuel reserves are such that strategically, Canada will be in a position to supply a significant percentage of the EU’s long term energy requirements.
The possible creation of a mega project to create a deep water port at Churchill, Manitoba would enable BC, Alberta, Saskatchewan and Manitoba to ship heavy commodities and containers through Hudson Bay and the Northwest Passage, shortening time and lowering costs, appreciably.
Canada committed to build two massive Polar Ice breakers for delivery by 2030. If Canada and the prairie provinces commit to the deepwater port project, including pipelines, a rail line and the creation of an offshore trade terminal in Hudson’s Bay, — oil, coal, LNG and CNG as well as Potash and grain could flow to Europe and the global south, year round.
Climate change is rapidly making the construction of the port, not just viable, but preferential.
In any event. Canada will be in a much more stable and shielded position in the future, as reliance on the United States for both trade and defence will become minimal.
And yes, Canada will defend itself by increasing its military strength and by purchasing new weapon systems from its allies, — the UK, Japan, Germany, France, Sweden and the rest of the EU and ASEAN countries.
Unfortunately, in terms of the relationship, the U.S. will also become much less important to Canada.
And while Canada’s global share of trade has shrunk in recent years, it has not been nearly as precipitous as that of America, so seeking new markets, joint ventures and trustworthy partners is certainly in Canada’s interest, in any event.
Now that the U.S. has effectively torn up the USMCA and GATT agreements, Canada will be well within its rights to seek new partners for all of its strategic minerals, including rare earth, lithium, nickel, cobalt, uranium, etc. etc.
This will radically shift how Canada perceives the future and its relationship or lack of one with the Untied States.
Undoubtedly, China will become a significant partner moving forward, as China requires almost all of Canada’s strategic minerals, metals and fossil fuels for its growing economy.
And at least, in relation to trade, China can be trusted.
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