Canada Targets U.S. Products for C$150 Billion in Retaliatory Tariffs

Canada’s government has identified C$150 billion ($105 billion U.S.) of American manufactured goods that it will hit with retaliatory trade tariffs.

The list is a draft and would only be used if president-elect Donald Trump makes good on his threat to levy tariffs as high as 25% on Canadian products. The retaliatory tariffs identified by Canada’s government come as the neighboring countries move closer to a trade war .

While the products on Canada’s tariff list weren’t disclosed, they are likely to be similar to ones Canada enacted in 2018 after Trump placed tariffs on Canadian steel and aluminum. During that previous trade battle, Canada placed tariffs on U.S.-manufactured goods ranging from whiskey to washing machines.

Pressure Tactics

Canada’s previous tariffs were aimed at putting pressure on factories in the constituencies of Republican politicians in the U.S. However, the 2018 tariffs were much smaller in scope, impacting about $16 billion of U.S. imports.

Last year, Canada imported nearly $500 billion worth of American goods, so the retaliatory tariffs would cover nearly a third of the value of the products the country gets from the U.S. Prime Minister Justin Trudeau and the premiers of Canada’s provinces met in recent days to strategize on how to deal with escalating trade protectionism in the U.S.

Is the Vanguard FTSE Canada All Cap Index ETF a Buy?

The Vanguard FTSE Canada All Cap Index ETF, which provides broad exposure to the Canadian equity market, has a consensus Moderate Buy rating based on 160 Wall Street analysts. That rating is based on 134 Buy, 25 Hold, and one Sell recommendations issued in the last three months. The average VCN price target of $58.77 implies 16% upside from current levels.

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