U.S. President Donald Trump is warning that a tax on Canadian auto imports would be “devastating” for Canada.
In two instances, Trump spoke about trade talks with Canada, first to reporters on Air Force One then again at a fundraiser in North Dakota.
While also saying he wants to make a “fair deal” with Canada, he said he could impose the automobile tariffs.
“I don’t want to do anything bad to Canada. I can — all I have to do is tax cars — it would be devastating,” he said.
Trump spoke while Canadian Foreign Minister Chrystia Freeland was meeting in Washington with U.S. Trade Representative Robert Lighthizer.
Last week, the U.S. and Mexico reached a preliminary agreement to replace the 24-year-old North American Free Trade Agreement. But those talks excluded Canada, the third NAFTA country.
Later at the fundraiser, Trump said all he had to do is threaten Canada’s cars “and they say, ‘Okay we’ll make a deal!’”
“So every time I have a problem with these, you know, many of these countries that we’re talking about, especially the big car countries,” he went on. “I just say, ‘Okay! Look, that’s okay. I’m going to put a 20 per cent tax on your cars.’ ‘We’ll do it! We’ll do it, we’ll agree.’”
“Actually in Canada, a tax on cars would be the ruination of the country,” he continued.
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While it’s an exaggeration that Canada would be ruined, economists have said the country’s GDP could slow by one per cent, and the effects could be doubled in Ontario — even sending the province into a recession.
The comments seem to confirm reportedly off-the-record remarks Trump made last week, in which Trump said he put up a picture of a Chevrolet Impala (which is made in Ontario) when there’s a problem during trade talks.
“Every time we have a problem with a point, I just put up a picture of a Chevrolet Impala,” Trump said, according to The Toronto Star.
Prime Minister Justin Trudeau has promised to protect autoworkers while negotiations for NAFTA continue.
— with files from the Associated Press