Canadian Prime Minister Mark Carney says Canada will keep working toward a new trade framework with the United States despite U.S. President Donald Trump saying he'll raise taxes on many imported goods from Canada to 35%. Trump's move deepens a rift between two North American countries that have suffered a debilitating blow to their decades-old alliance. Alabama U.S. House member Terri Sewell was in Tuscaloosa for a small business round table at the Edge Incubator Center. She says tariffs, overall, may hurt Alabama.
“You know, the reality is they're (small business owners) having to plan their orders way in advance, to the extent that they can stockpile inventory early, they can get cheaper prices or get the prices that are now in anticipation of prices rising,” said Sewell of the possible impact of Trump tariffs. “And so people are very concerned. Uncertainty in our economy is really what drives not just large businesses, but small businesses as well.”
The U.S. Trade Representative says Alabama exported over $4 billion dollars worth of goods to Canada in 2024, which might be subject to retaliatory tariffs north of the border. That 2024 total reportedly represents a 7% increase over the previous year. Trump has also threatened 25% tariffs against Japan and South Korea. Alabama exports to South Korea totaled over $1 billion dollars in 2023, making that nation the state’s fifth biggest trading partner. Exports to Japan were less at over $800 million. Still that makes the country Alabama’s fifth biggest destination for goods in 2024. Representative Sewell says the pain from tariffs may be keenly felt over the holidays…
“I'm all about using every tool in the toolkit to help our economy, and targeted tariffs definitely have its place in strategic economic development, but this sort of untargeted, you know, whimsical way that we're going about it, and not in a way that is backed by science or by research, is really problematic, and I don't see us cutting off our nose to spite our face, doing away with our with centuries of allies that have helped us and and so I'm really nervous about what's going to happen,” she said.
Trump's letter Thursday to Canadian Prime Minister Carney is an aggressive increase to the top 25% tariff rates the Republican president first imposed in March after months of threats. Carney says through the current trade negotiations with the U.S., Canada has defended its workers and business. Stock market futures are down Friday, a sign Trump’s tariff letters may be concerning investors. Trump has also expressed frustration with a trade deficit with Canada that largely reflects oil purchases by America.
“I must mention that the flow of Fentanyl is hardly the only challenge we have with Canada, which has many Tariff, and Non-Tariff, Policies and Trade Barriers,” Trump wrote in the letter.
The higher rates would go into effect Aug. 1, creating a tense series of weeks ahead for the global economy as recent gains in the S&P 500 stock index suggest many investors think Trump will ultimately back down on the increases. But stock market futures were down early Friday in a sign that Trump's wave of tariff letters may be starting to generate concern among investors.
In a social media post, Carney said Canada would continue to work toward a new trade framework with the U.S. and has made “vital progress to stop the scourge of fentanyl.”
“Through the current trade negotiations with the United States, the Canadian government has steadfastly defended our workers and business,” Carney said.
