The trade war that United States President Donald Trump has triggered with Canada is expected to hurt businesses in both countries.<\/p>\n
But experts say the damage to the Canadian economy will be worse, as the tit-for-tat tariffs have raised the chances of a recession.<\/p>\n
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On Saturday, the US imposed 50 percent tariffs<\/a> on $20bn worth of Canadian goods after trade negotiations between the two countries collapsed. On Monday, Trump also threatened Canada with new 50 percent levies on all car products, starting January 1.<\/p>\n On Tuesday, Prime Minister Mark Carney unveiled retaliatory measures against more than 700 US products, also valued at $20bn. The tariffs are tiered at 15, 25 and 50 percent, and they are slated to come into effect on September 8.<\/p>\n But while Canada\u2019s efforts have sparked a surge of nationalism, experts warn the feeling might sour in the face of economic losses.<\/p>\n \u201cPeople feel very energised by the idea of Canada standing up to Trump, and there\u2019s a palpable sense of patriotism in Ottawa, but I don\u2019t know how long it will last,\u201d said Vina Nadjibulla, cofounder and CEO of the Centre for Strategic Statecraft, a nonpartisan policy think tank in Canada.<\/p>\n Canada\u2019s economy is a 10th the size of its US counterpart, and the country sends about 70 percent of its exports south of the border, which makes it especially vulnerable to US trade penalties.<\/p>\n While the US tariffs will have a limited impact on the overall Canadian economy \u2014 the advisory firm Oxford Economics estimates they will shave 0.3 percentage points off its gross domestic product (GDP) next year \u2014 they will hurt specific provinces and sectors more significantly.<\/p>\n Job losses expected<\/p>\n Manufacturers in Quebec, New Brunswick, and Ontario will be affected the most, as will exporters in British Columbia, as they rely heavily on sales to the US.<\/p>\n According to Oxford Economics, those provinces are vulnerable because they produce items that are easy to substitute. Top of that list are cement, paper, wood, beverages, clothing, plastics and electronics.<\/p>\n Similarly, while Canada\u2019s tariffs on the US will have a muted impact, the costs on the individual states and businesses that rely on Canadian trade will escalate.<\/p>\n \u201cThis absolutely is a trade war,\u201d said Ashley Kalyn, an international trade consultant at Peacock Tariff Consulting in Toronto. \u201cWe are feeling the effects in Canada and expect upwards of 100,000 jobs to be lost.\u201d<\/p>\n Kalyn told Al Jazeera that her firm has already heard that some clients are planning to shut down factories and lay off workers if the tariffs remain in place. \u201cThat\u2019s how real this is,\u201d she said.<\/p>\n Tensions have continued to escalate this week after Trump announced on Thursday that the US federal government will now refer to Lake Ontario as Lake America<\/a>, in protest against Canada.<\/p>\n Prime Minister Mark Carney pointed out<\/a> on social media that the word \u201cOntario\u201d is not Canadian but Indigenous. \u201cThe name is more than 400 years old, predating both the Confederation of Canada and the Declaration of Independence of the United States of America,\u201d Carney wrote.<\/p>\n Manitoba Premier Wab Kinew also dismissed the renaming as a feeble effort. Trump had made a similar announcement last year, swapping the name \u201cGulf of Mexico\u201d for \u201cGulf of America\u201d amid tensions with Mexico over immigration and border security.<\/p>\n \u201cYou know when a rock band is really over the hill, and you see them in a casino playing some song from like 50 years ago? I think that\u2019s the part of Donald Trump\u2019s presidency we\u2019re at now,\u201d Kinew told reporters in Winnipeg. \u201cIt\u2019s not his best work.\u201d<\/p>\n A \u2018permanently lower path\u2019<\/p>\n