Canadian Prime Minister Justin Trudeau quietly shuffled his cabinet around on Wednesday, hinting that he has had enough of President Donald Trump's aggressive posturing on North American trade.
BREAKING: PM Justin Trudeau has made significant changes to his cabinet, bringing five new ministers to the table a… https://t.co/1m9eHOOQ1q— CBC News (@CBC News) 1531923526.0
Trudeau tapped former natural resources minister Jimm Carr to head the ministry of international trade diversification, signaling Canada's desire to reduce its dependence on trade with the United States as threats of a trade war loom between the NAFTA member nations.
An under-the-radar move by Canadian Prime Minister Trudeau showed that Canada is ready to get tough with Trump on t… https://t.co/0iJJWdesvx— Business Insider (@Business Insider) 1532004274.0
The cabinet shake-up is widely seen as a prequel to Trudeau's re-election campaign, which is expected to be a contentious race.
Make no mistake — Trudeau's cabinet shuffle is his re-election kickoff: Chris Hall https://t.co/zPgGaLLgyb #hw… https://t.co/1qI9Pyv56X— CBC Politics (@CBC Politics) 1531949486.0
The move comes weeks after Trudeau announced nearly $13 billion in retaliatory tariffs on a variety of American products, including aluminum, steel, orange juice, and whiskey, in response to Trump's levying of a tax of 10 and 25 percent on imported Canadian aluminum and steel, respectively.
Trudeau described Trump's imposition of tariffs on Canadian goods as "frankly insulting" during last month's G7 summit. Canada is the largest importer of steel to the United States. Last year, 70 percent of Canada's trade took place with the United States, and 64 percent of Canada's GDP is generated through trade with other countries, the World Bank says.
"There is certainly a level of clarity for Canadians, for businesses, for everyone across this country that we need to diversify our markets," Trudeau said at a press conference. "We need to ensure that we are not as dependent on the United States."
Gerald Butts, one of Trudeau's closest advisors, sent a tweet emphasizing the importance of "diversifying" Canada's trading markets. "We need to get Canadian resources to markets other than the United States," he said.
#Trade diversification has never been a more urgent national priority. We need to get Canadian resources to markets… https://t.co/BNbxL1bdzr— Gerald Butts 🇨🇦 (@Gerald Butts 🇨🇦) 1531912186.0
Canada's concerns over the future of trade with the United States have increased in recent days due to Trump's threat of additional tariffs on imported cars and auto parts. The U.S. Census Bureau reported Americans bought $55 billion worth of automobiles and parts from Canada in 2017.
Trump met with the U.S.'s top trading partners in Canada at the annual G7 conference in June and accused them of cheating the American people on trade.
Canada was a particular target of the president, who claimed we have a $100 billion trade deficit with our northern neighbor.
Fair Trade is now to be called Fool Trade if it is not Reciprocal. According to a Canada release, they make almost… https://t.co/Oc12IrKAq1— Donald J. Trump (@Donald J. Trump) 1528679107.0
This was quickly refuted by veteran Republican operative Karl Rove, who appeared on Fox News and showed that the U.S. is actually running a trade surplus with Canada.
.@KarlRove explains the trade balance with Canada, using arithmetic. Spoiler alert: US runs a surplus. https://t.co/LNEP5RUzYU— Karen Tumulty (@Karen Tumulty) 1528731710.0
Rove noted that American exports to Canada are valued at $320.16 billion dollars, while imports from our northern neighbor total $307.6 billion. That leaves a trade surplus of $12.56 billion.
The Office of the U.S. Trade Representative says the U.S. has a trade surplus with Canada. It reports that in 2016, the U.S. exported $12.5 billion more in goods and services than it imported from Canada, leading to a trade surplus, not a deficit.
The Washington Post also confirmed the $12.56 billion surplus.
Trudeau tried to explain the U.S.-Canada trade relationship to Trump, who refused to accept what he was being told, frustrating his fellow G7 leaders.
The prime minister said:
“Look, here’s the essence of our trading relationship. We sell you a lot of oil and energy and you sell us a lot of food and manufactured goods. It is a trillion dollar relationship. We could pick any one of those things and argue over the numbers. But shouldn’t we be talking about the relationship as a whole, which is an unmitigated positive for both of us?”
Trump then whined that the United States would no longer be a “piggy bank” that the rest of the world is “robbing.”