Ontario Premier Doug Ford Warns That Trump's Tariffs Could Lead to Disaster for US Markets

Ontario Premier Doug Ford expressed deep concern over President-elect Donald Trump's proposal to impose a 25% tariff on Canadian goods, warning it could severely impact US stock markets. Ford highlighted the interconnected nature of the US and Canadian economies, particularly in the auto industry, where parts frequently cross the border before final assembly in Ontario or Michigan.

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Ford emphasised that tariffs would disrupt this integration, causing significant market repercussions. "It is so integrated. I don't even know how you separate that in the supply chain. It would be a disaster," Ford told the AP. "It will affect the market. The market will drop and we have every CEO saying that is not the way to go."

Trade and Economic Concerns

Canada's ambassador to Washington, Kirsten Hillman, pointed out that the US had a USD 75 billion trade deficit with Canada last year. She noted that a third of Canadian exports to the US are energy-related, with prices remaining high. Hillman explained that trade balances are crucial to Trump, stressing the need for context given Canada's smaller economy.

Ford also addressed Trump's mass deportation plans, stating he is "extremely worried" about their potential impact. He mentioned a strategy involving hundreds of police officers ready to secure the border if necessary. "We do have a plan ready," Ford said. "We have hundreds of provincial police officers that are ready within hours, if not immediately, to hit the borders."

Border Security Measures

Canada's federal government recently unveiled details of a billion-dollar border initiative aimed at preventing tariffs. This includes forming an aerial intelligence task force for continuous border surveillance using helicopters, drones, and towers. Canada also proposed a North American "joint strike force" to combat cross-border organised crime.

Public Safety Minister Dominic LeBlanc expressed optimism about US reception to these measures after discussions with American officials. "We have a lot of work ahead of us," LeBlanc stated, downplaying suggestions that Canada was merely complying with US demands.

Ford reiterated his willingness to limit electricity exports to states like Michigan if tariffs are enacted. He stated, "I want to sell them more energy, more critical minerals, but I'm going to always keep every tool in our toolbox available." Canada supplies significant amounts of steel, aluminium, and uranium to the US and possesses 34 critical minerals vital for the Pentagon.

Immigration and Drug Trafficking

Trump's tariff threat is tied to concerns over migrant and fentanyl flows from Canada and Mexico into the US. However, statistics show stark differences between these borders. Last fiscal year, US customs seized 43 pounds of fentanyl at the Canadian border compared to 21,100 pounds at the Mexican border.

Most fentanyl entering the US originates from Mexican cartels using Asian-sourced chemicals. The US Border Patrol reported 1.53 million migrant encounters at the southwest border with Mexico from October 2023 to September 2024, compared to 23,721 at the Canadian border during that period.

Ford urged for dialogue with Trump to clarify Canada's position as an ally rather than an adversary. He also expressed interest in pursuing a bilateral trade agreement directly with the US while maintaining existing ties with Mexico.

Trump responded by questioning why Canada receives over USD 100 million annually in subsidies from the US on Truth Social. He suggested Canadians might benefit from becoming America's 51st state due to tax and military savings. This notion has been previously mentioned by Trump during his first term and recently resurfaced in public discourse.

The ongoing discussions between Canada and the US highlight complex economic and security issues requiring careful negotiation and collaboration between both nations.