Canada has fiscal room to tackle impact of US tariff

20/12/2024 6:10

Canada's new Finance Minister

Dominic LeBlanc said the country's financial reserves are enough

to support businesses and individuals if the United States

imposes a major new tariff.



U.S. President-elect Donald Trump has vowed to impose a 25%

tariff on all imports from Canada and Mexico on his first day in

office on Jan. 20 if those countries do not clamp down on

illegal migration and what he calls a flow of drugs across the

borders.



"I am reassured that the government has the fiscal room if

there's a decision that has to be made to intervene

significantly," LeBlanc said in a podcast on Wednesday,

referring to his discussions with Finance Ministry officials.



LeBlanc assumed the role after his predecessor, Chrystia

Freeland, stepped down on Monday, citing differences with Prime

Minister Justin Trudeau on managing finances, including her

concern about having enough fiscal reserve to soften the impact

of a U.S. tariff.



"I don't think any responsible government would allow the

economy of the country to be permanently scarred by what is a

decision of another government," LeBlanc said, adding that he

would meet with Bank of Canada Governor Tiff Macklem and

commercial bank CEOs in the coming days.



LeBlanc did not elaborate on what specific support the

government might be contemplating.



LeBlanc, who is also public safety minister, said he has had

discussions with Trump's pick for Commerce secretary, Howard

Lutnick, and hopes to have further talks with him before the new

year to discuss border issues.



Earlier this week, LeBlanc and fellow ministers announced a

plan to beef up the U.S.-Canada border with helicopters, drones,

surveillance towers and sniffer dogs, as well as a joint strike

force to target transnational organized crime.