How does it affect Canadians?
Yasmine Elsayed (she/her) // Contributor
Ren Zhang (they/them)// Contributing visuals
In Nov. 2024, just three weeks after his inauguration, Donald Trump announced he would impose a 25 per cent tariff on Canada and Mexico, citing border security and U.S. safety. This created an undertone of trade tensions.
Shortly after, in Feb. 2025, Donald Trump acted on his announcement by initiating the trade war. He asserted that the United States has not been gaining as many economic and political advantages as it is losing. Trump claims that the U.S. has been “ripped off for 50 years by Canada,” and chose to go against the 2018 Free Trade Agreement that was initially proposed and supported by the Trump administration. This caused the Canadian economy to take a significant hit.
USAfacts states that the U.S. and Canada have a trade deficit, which is when a country imports more than it exports. From the U.S. perspective, Canada profits more from its exports to the U.S. than the U.S. does, highlighting the importance of trade dynamics. “In 2025, 85.8% of U.S. imports from Canada were goods. The largest category was industrial supplies and materials, which include oil, chemicals, plastics and other items used in the production processes. These imports totalled $195.9 billion.” The U.S., conversely, exports about 78.4 per cent to Canada.
TD Economics says some record-setting is still needed. While the two countries have a trade deficit, it is not as large as the U.S. makes it out to be. On the contrary, “[Canada] makes up one of the smallest trade deficits.” This further explains that the U.S. benefits greatly from trade with Canada because of the high quality of its goods and services. For example, the U.S. manufacturing, automotive, and infrastructure sectors need aluminum and steel. According to the Aluminium Association of Canada, the U.S. relies on Canada for 75 per cent of its aluminum.
Canada imposed retaliatory tariffs to pressure the Trump administration to lift its tariffs. From a geopolitical standpoint, it is important that North America maintain amicable and stable relations. The trade war could have serious consequences. While costly, the Canadian government had an obligation to defend itself. If the government had not retaliated, it would have sent Canadians a clear message: it does not stand up for its people. There was no better way to respond to this trade war while defending Canada’s sovereignty.
Since the trade war began, Canadians have been caught in the crossfire. Due to the intense inflation, groceries and many other necessities have become too expensive for most Canadians to afford. Harris and Partners conducted a nationwide survey of 2,664 Canadians in order to determine how their finances have changed since the trade war. The survey emphasized that Canadians now feel more financially vulnerable than they did before the trade war.
Key points include:
- 95.2 per cent of Canadians say rising costs—including food, housing and utilities—have impacted their finances recently.
- 94.2 per cent report that broader economic changes like inflation and interest rates are affecting their financial plans.
- 93.6 per cent feel that rising everyday costs are putting direct pressure on their finances.
- 91.6 per cent have changed how they manage money in the past six months due to these shifting economic conditions.
This suggests that the cost of living and the income Canadians receive are inversely related. Purchasing power is decreasing while the cost of living is rising. Generally speaking, Canada was already facing affordability challenges before the trade war, and now it has hit a new high of unaffordability.
The Daily Hive reported in 2023 that the average minimum-wage worker in British Columbia needed at least $32 per hour in order to afford a one-bedroom apartment. In 2025, “you’ll need to earn almost $40 an hour just to afford a one-bedroom apartment,” the Daily Hive writes in a 2025 article. Food affordability has also gone up. “Affordability is outweighing nutrition and taste when Canadians are buying food, and some are even dipping into their savings or borrowing money to make those purchases,” The Global News reports.
Canadians stepped up when the country needed them. The “buy Canadian” movement showed that boycotts can cause damage. Now the Canadian government must help Canadians make life affordable, since this movement realistically cannot last much longer. While the importer pays the required tax on imported goods, the consumer still pays for the price increases. American economist Kimberly Clausing, in an interview with Time Magazine, said, “We’re actually kind of taxing ourselves when we put on the tariffs, and the Canadians are taxing themselves in response. So it’s the actions of the Trump Administration that are raising costs for U.S. consumers. The actions of the Carney administration are not; they’re hurting Canadian consumers.”
The lack of competition in grocery stores is constantly weakening the Canadians’ resolve to maintain the boycott. For years, Canadians have spoken up about the lack of competition. In 2023, ex-NDP leader Jagmeet Singh introduced Bill C-352, a bill aimed at lowering prices for Canadians. The NDP tried to confront this issue head-on, criticizing the oligopoly and the monopolization of Canadian livelihoods. Although it had some early success, the bill did not pass. As a result, Canadians’ need to cope with the affordability crisis may outweigh their desire to boycott.