President Donald Trump has suggested the potential imposition of 25% tariffs on all Canadian imports. Despite recent meetings between Trump and several Canadian premiers, there has been no indication of exemptions for key sectors like energy, agriculture, and manufacturing. In response, Canadian federal and provincial governments are actively engaging with U.S. officials to address concerns related to border security and highlight the impact on industries on both sides of the border, aiming to prevent or mitigate the effects of these tariffs.

Data from the Canadian Chamber of Commerce suggests that imposing 25% tariffs on trade would deliver a 2.6% annual hit to Canada’s real GDP, equating to $1,900 per person. While Saskatchewan is less reliant on U.S. trade than most other provinces, the province still exported $26.9 billion worth of goods in 2023, with top exports including crude oil ($11.6 billion), potash ($4.9 billion), and canola oil ($2.5 billion). More than 68,000 Saskatchewan jobs and 1,500 businesses are supported by exports to the U.S., while Canadian investment supports over 39,000 jobs in Illinois, Saskatchewan’s top partner state.

Canada’s trade relationship with the U.S. is critical, with 60% of U.S. crude oil imports and 77% of Canada’s overall exports—nearly $600 billion in 2023—going south of the border. Furthermore, 1.4 million American jobs are tied to Canadian exports, and Canada is the number one export market for 34 U.S. states. The value of Canadian direct investment in the U.S. is nearly $1.1 trillion, compared to $620 billion of direct U.S. investment in Canada. As a result, the implementation of tariffs would have far-reaching consequences, including an added cost of $1,300 per year for the average American family.

To mitigate the risks of potential tariffs, federal and provincial governments must prioritize diplomatic action to secure exemptions for highly integrated sectors of the economy. Additionally, addressing interprovincial trade barriers—which currently inflate costs by 7.8% to 14.5%—could unlock an estimated $50 to $130 billion in economic value, providing substantial opportunities for Saskatchewan businesses to grow and prosper. Strengthening the Canada-United States-Mexico Agreement (CUSMA) is also critical. Resolving key issues, such as border security and fulfilling NATO spending commitments, would reinforce this vital trade agreement. Saskatchewan should capitalize on its nine international engagement offices to further diversify export markets. A collaborative and strategic response is essential to safeguard our industries, protect jobs, and maintain the deeply integrated trade relationship that benefits both nations.