As President Trump successfully concluded his historic meeting with Kim Jong-un in Singapore, America’s closest allies were still reeling from a tumultuous end to the G7 summit. Hours after the divisive summit in Quebec, Trump lambasted Canadian Prime Minister Justin Trudeau in a series of tweets, calling him “very dishonest and weak” and claiming he “acts hurt when called out”. The tweets were in response to a news conference held by Trudeau in which he vowed retaliatory action against U.S. tariffs on steel and aluminum. Unsurprisingly, the tweets infuriated Canadians with The Globe and Mail newspaper calling the outburst “one of the most flagrant manufactured crises ever perpetrated by an American administration against an ally”.
With the war of words (and tweets) still leaving a bitter taste in mouths, it makes sense to take a look at the reality of the situation and whether Canada has leverage in a potential trade war. Even though the Canadian government has often publicized the fact that Canada is the most important trading partner for 35 U.S. states, there are only two states where trade exceeds 10 percent of economic output. On the other hand, Canadian provinces have always been heavily dependent on U.S. imports. If the situation continues to escalate, there could still be serious economic consequences on both sides of the border and some U.S. states could start seeing some ripple effects in their employment rates.
Last year, website canadianbusiness.com analyzed government figures from both countries to find out how many U.S. jobs depend on trade with Canada. In total, some 9 million jobs are reliant on trade with Canada. California (1.66 million), New York (680,900) and Florida (620,000) have the most at stake while Alaska (21,300), Vermont (18,900) and Wyoming (13,100) have the least jobs tied to Canadian trade. Even if Trump continues to take an aggressive protectionist stance on trade with the country’s most important allies, the U.S. certainly won’t be immune from retaliation.
*Click below to enlarge (charted by Statista)
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