Canada and China retaliate to US tariffs
Canadian prime minister Justin Trudeau has responded to president Donald Trump’s move with a retaliatory 25% tariff on US goods, while China will introduce a 10%-15% tariff.
Trump gave the go-ahead for 25% tariffs on Canada and Mexico last week (27 February), after delaying them for a month following 11th-hour talks with Trudeau and Mexican president Claudia Sheinbaum.
China will be subject to 20% tariffs, doubling the levy from last month.
However, it is believed spirits will be unaffected by China’s new tariffs on US-made products, which mainly impact meat, fruit and vegetables, and wheat.
Canada
The sector is unlikely to be spared from Canada’s tariffs, which became effective at 12.01am today (4 March).
Tariffs will first be introduced against CA$30 billion (US$20.79bn) worth of goods immediately, and against CA$125bn (US$86.61bn) in 21 days’ time.
In a statement, Trudeau said: “Our tariffs will remain in place until the US trade action is withdrawn, and should US tariffs not cease, we are in active and ongoing discussions with provinces and territories to pursue several non-tariff measures.
“While we urge the US administration to reconsider their tariffs, Canada remains firm in standing up for our economy, our jobs, our workers, and for a fair deal.
“Because of the tariffs imposed by the US, Americans will pay more for groceries, gas and cars, and potentially lose thousands of jobs. Tariffs will disrupt an incredibly successful trading relationship. They will violate the very trade agreement that was negotiated by president Trump in his last term.”
When Trump first announced his plans to introduce tariffs, American spirits were pulled from stores in Ontario, British Columbia and Nova Scotia.
Last week, CGA by NIQ’s Mitch Stefani said the tariffs could be a ‘positive opportunity’ for Canadian whisky.
Mexico and the US
Mexico is yet to respond to the news. Yesterday (3 March), Sheinbaum said: “It’s a decision that depends on the United States government, on the United States president. Whatever his decision is, we will make our decisions and there is a plan and there is unity in Mexico.”
We recently did a deep-dive into how spirits brands have been preparing for tariffs, and what moves are likely to come next.
Last week, the producer of Jose Cuervo Tequila predicted an US$80 million impact on its business in 2025 from US tariffs, with other Tequila brand owners voicing their concerns last month.
Meanwhile, the Distilled Spirits Council of the US (Discus) said the tariffs could result in the loss of 31,000 US jobs.
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