Canada Trade War Escalation Threatens North American Economy

Canada may seem like an unlikely target for a US trade war given that no country on Earth buys as much from America as its northern neighbor. In fact, Canada is second only to Mexico as an export market for American farmers.

A North American trade pact negotiated by President Donald Trump during his first term means most American products enter Canada duty-free. Rankings of the world's most open economies usually put Canada near the top.

However, when Trump looks at Canada, he sees a predator out to cheat the United States and strangle its industries. The president has goaded Canada's leaders with personal attacks, portraying the longtime US ally as weak.

The breakdown in relations between the two countries began after their latest trade talks collapsed on August 21. Since then, Trump has slapped 50% tariffs on $20 billion worth of Canadian products to protest what he described as discrimination against US auto, dairy, and alcoholic beverage exports.