In late November, Trump said he would impose 25% tariffs on goods from Canada and Mexico after taking office due to the unresolved problem of illegal immigration and drug trafficking in the United States, and also promised to add 10% to export duties on goods from China.
"We will, of course, as we did eight years ago, respond to unfair tariffs in a number of ways, and we’re still looking at the right ways to respond," Trudeau was quoted as saying by the WSJ.
On December 3, Trump jokingly suggested that Canada would be better off as the 51st state of the United States if its economy could not withstand potential American tariffs on Canadian goods.
Under the terms of the United States-Mexico-Canada Agreement (USMCA), many goods are traded duty-free between the three countries, provided that the rules of origin and other standards are met. In that sense, the US president-elect's proposal would be a violation of the treaty that could complicate economic and political relations between the region's states.