An under-the-radar move by Canadian PM Justin Trudeau showed that Canada is ready to get tough with Trump on trade

Leon Neal/Getty ImagesUS President Donald Trump and Canadian Prime Minister Justin Trudeau.
  • Canadian Prime Minister Justin Trudeau announced a reshuffle of his Cabinet on Wednesday.
  • As part of the reshuffle, Trudeau said Jim Carr would become minister of international trade diversification.
  • Trudeau also emphasised the need to move away from trade with the US.
  • The move was a shot at US President Donald Trump’s antagonistic trade policies toward Canada.

Canadian Prime Minister Justin Trudeau used a small, under-the-radar move during his Cabinet reshuffle to take a direct shot at US President Donald Trump’s policy and the burgeoning US-Canada trade conflict.

As part of the broader reshuffle, Trudeau on Wednesday selected Jim Carr, formerly the minister of natural resources, to be the minister of international trade diversification.

The newly renamed position underlined Trudeau’s desire to shift Canada away from a dependence on trade with the US amid the growing threat of a trade war between the two countries.

“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.”

Trump kicked off a trade fight with Canada last month by imposing tariffs on steel and aluminium exports to the US. Trudeau responded with tariffs on nearly $US13 billion worth of US exports to Canada.

Trudeau has since taken a much tougher approach to dealing with Trump, calling Trump’s decision to impose the tariffs on Canadian metals “frankly insulting” and confronting the US president during the G7 summit in Quebec.

According to the World Bank, 64% of Canada’s gross domestic product comes from trade, compared with 27% for the US. Given that last year roughly 70% of Canada’s trade (exports and imports) was conducted with the US, the Canadian economy would be extremely exposed to the US market in the event of a full-blown trade war.

Earlier Wednesday, Gerald Butts, one of Trudeau’s top advisers, also touched on the need to find alternative trade partners.

“Trade diversification has never been a more urgent national priority. We need to get Canadian resources to markets other than the United States,” Butts tweeted along with an article about a new pipeline that could help get Canadian oil to India and China.

The need to move away from the US is also critical for Canada given Trump’s threats to impose tariffs on cars and auto parts. The US imported $US55 billion worth of motor vehicles and parts from Canada last year, according to US Census Bureau data.

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