With the United States being Alberta’s top trade partner, sweeping 25 per cent tariffs proposed by President-Elect Donald Trump could have a major effect on the province’s economy.
Trade with the United States made up 89 per cent of the province’s exports in 2023, according to the Government of Alberta.
Last year alone, Alberta exported $156.3 billion south to the U.S.
Crude petroleum made up the majority of those exports, totalling $113.4 billion – 73 per cent.
On Monday, Trump announced that on his first day in office he would impose a 25 per cent tariff on all products from Mexico and Canada and an additional 10 per cent tariff on goods from China, citing concerns over illegal immigration and the trade of illicit drugs.
“On January 20th, as one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% Tariff on ALL products coming into the United States, and its ridiculous Open Borders,” Trump said in a post on Truth Social.
Trump said the tariffs would remain in place until the two countries clamp down on drugs, particularly fentanyl, and migrants crossing the border illegally.
In a social media post on Monday afternoon, Alberta Premier Danielle Smith said the federal government must take the new U.S. administration seriously.
Smith shared a letter sent to Prime Minister Justin Trudeau on Monday, on behalf of Canada’s premiers, asking for a First Ministers’ meeting to discuss Canada-U.S. relations.
“The success of our trade relationship with the U.S. directly impacts families and communities across our country. Ottawa needs to step up and prioritize this partnership,” Smith said in the post.
Nationally, the U.S. is Canada’s largest foreign customer, accounting for $595 billion in 2023 – 89 per cent of total exports – according to a report from ATB Economics.
Experts have warned that a blanket tariff would not only shrink the Canadian economy, but also result in higher prices for goods on both sides of the border.
“It’s not any sort of economic justification for what he’s doing. He wants to try and make the border safe. He thinks that Canada is a source of insecurity, not for immigrants, but for illegal drugs coming into the country,” said Moshe Lander, an Alberta-based economist with Montreal’s Concordia University.
“We knew that this was going to be a mess. We saw it four to eight years ago during his first presidency. I don’t think there’s any secret that he was looking to do maximum damage.”
China is Canada’s next largest trading partner, making up four per cent of total merchandise exports ($30.5 billion).
The Chinese market makes up a smaller chunk of Alberta’s total exports, sitting at $5.5 billion in 2023, or three per cent.
Later Monday, Smith posted to social media on the matter again, saying the incoming Trump administration “has valid concerns related to illegal activities at our shared border. We are calling on the federal government to work with the incoming administration to resolve these issues immediately, thereby avoiding any unnecessary tariffs on Canadian exports to the U.S.”
With files from Reuters and CTV News Calgary’s Teri Fikowski
