‘What hurts us, hurts them’: Northern officials fear impact of Canada-U.S. trade war

With U.S. president-elect Donald Trump set to take office Monday, northern government and industry leaders are sounding the alarm over the impact a trade war between Canada and the U.S. could have.

“What hurts us, hurts them,” Karen Costello, executive director of the NWT & Nunavut Chamber of Mines, said Friday.

Trump has threatened to impose new 25 per cent tariffs on all Canadian goods the U.S. imports. In Ottawa this week, Canada’s premiers and Prime Minister Justin Trudeau huddled to plan a response if the tariffs are implemented, which could possibly see Canada retaliate by placing new tariffs on products imported from the U.S.

Costello said the Canadian and American economies are so “interconnected,” a trade war in which the two countries slap new tariffs on each other’s exports will harm both nations.

“Punitive tariffs would harm the Canadian dollar, devaluing it,” she said.

Speaking to reporters in Ottawa on Monday, federal NDP Leader Jagmeet Singh suggested a ban on exporting critical minerals to the U.S. as retaliation if Trump makes good on his tariff threat.

Mining is a major sector in Nunavut’s economy.

Nunavut NDP MP Lori Idlout said in an interview Inuit should be consulted before Canada imposes any retaliatory tariffs against the U.S. that could harm the North’s economy. Agnico Eagle’s Meliadine gold mine near Rankin Inlet, and Baffinland Iron Mines Corp.’s Mary River iron ore mine in northern Baffin Island, are on Inuit land.

Alluding to Trump’s recent interest in annexing or buying Greenland, Idlout said the Canadian government needs to prioritize Arctic sovereignty. Trump has also mused about Canada becoming the 51^st state of the U.S.

During a conference call with reporters Thursday, federal Natural Resources Minister Jonathan Wilkinson said Singh “doesn’t know what he’s talking about,” in response to the NDP leader’s proposed critical minerals ban, according to a spokesperson for Wilkinson.

However, Wilkinson said the government is considering imposing tariffs on critical minerals, among other options if the U.S. does slap new tariffs on Canadian products.

“If the U.S. should impose tariffs on Canada, the Government of Canada will respond,” Wilkinson said. “There is no universe in which Canadians would expect less of their government.

“There are a range of options and certainly, things like critical minerals may be part of that conversation as we move forward, but we are not interested in this being an escalatory issue. Everybody loses if this becomes ‘we do something, they do something, we do something, they do something.’”

Baffinland spokesperson Peter Akman said in an email Thursday that “Baffinland’s high-grade iron ore is currently shipped to Europe, and as such, we do not foresee a direct impact on our ore sales from potential tariffs on Canadian exports to the U.S.”

Except for the high-grade iron ore extracted at Baffinland’s Mary River mine, all other critical mineral projects in the territory are at the exploratory stage, Costello said.

Where miners in the North — including those working at projects still at the exploratory stage — might be impacted is if new tariffs are placed on imported mining equipment and machinery Nunavut companies need to operate, she said.

Akman agreed, saying: “Any retaliatory tariffs imposed by Canada on imported goods, such as machinery and equipment necessary for our operations, could affect our costs. We continue to monitor the situation closely to assess any potential financial impact on our supply chain.”

“We will just have to wait and see what happens after Trump’s inauguration on Monday,” Costello said.

Agnico Eagle did not respond to a request for comment.

Located in Iqaluit, Nunavut, Canada, Nunatsiaq News is dedicated to covering affairs in Nunavut and the Nunavik territory of Quebec since 1973. It has been a partner to ArcticToday and its predecessors since 2016.