Justin Trudeau's successor will confront significant hurdles, including US protectionist tariffs that threaten Canada's $2.1 trillion economy amid local issues like stagnant growth and a housing crisis. With Trump's return to the White House, fears mount over a possible 25-percent tariff on Canadian exports, which account for 80 percent of the country’s global exports and 20 percent of its GDP. Economists warn that such tariffs could lead Canada into recession, complicating the situation for the upcoming leadership transition and potential national elections in May.
Trump's promise to steer the US on a protectionist course sets up hefty challenges for whoever replaces Prime Minister Justin Trudeau, the country's deeply unpopular outgoing leader.
What happens to Canadian exports in case of a tariff war with the US—that's a huge determinant of economic outcomes as 80 percent of our exports go to the US.
A 25-percent tariff would have a significant effect on the Canadian economy, potentially triggering a recession.
Trump's tariff threats could be posturing, but the potential economic ramifications remain a looming challenge for Canada.
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