Days after trade talks with the Trump administration collapsed, the Canadian Liberal government unveiled a $7.5 billion aid package to assist workers and businesses facing new 50% tariffs on $27.6 billion worth of Canadian exports imposed by the U.S. president.
Finance Minister François-Philippe Champagne and other officials revealed that, starting from September 8, the government would match the U.S. tariffs dollar for dollar by imposing equivalent tariffs on $27.6 billion worth of comparable American goods.
“This situation poses an unprecedented challenge to Canada, but we are ready to face it together,” Champagne stated during the announcement at a roofing company in Ottawa. He emphasized the government’s commitment to supporting workers, businesses, and industries for as long as necessary.
The support package, which complements the nearly $25 billion in existing tariff assistance implemented over the past 18 months, is primarily aimed at aiding workers and small- to medium-sized enterprises nationwide.
A significant portion of the $7.5 billion support funding, $3.5 billion, will be directed towards a rapid response initiative benefiting workers and employers. This includes extending specific changes to Employment Insurance (EI) provisions, such as waiving the one-week waiting period, extending EI payment permissions, and providing additional EI weeks for long-tenured employees.
New measures also include allowing voluntarily departed workers to access EI benefits without penalty and facilitating connections between unemployed individuals and major projects in need of staff. Additionally, employers can receive up to $1,000 per employee to cover training and administrative costs for EI work-sharing and retention programs.
Another initiative involves the creation of the Canada Strong Diversification Fund, with a $2 billion investment to support companies impacted by tariffs. The Large Enterprise Tariff Loan facility (LETL) will see modifications, extending financial liquidity periods and raising maximum loan repayment durations.
Furthermore, medium-sized enterprises will gain access to an additional $1.5 billion in funding distributed through regional development agencies. Businesses with over $1 million in revenue can benefit from various programs offering non-repayable grants and interest-free loans.
Canada’s retaliatory tariff regime targets specific U.S. products affected by previous American tariffs on Canadian goods. The strategy involves matching U.S. tariff rates on equivalent Canadian products to safeguard domestic industries, focusing on goods with Canadian alternatives.
Prime Minister Mark Carney held discussions with opposition leaders to update them on the government’s response to the escalating tariffs. Opposition parties expressed varying views on the government’s approach, with calls for additional measures to protect Canadian jobs and interests.
In a statement, the Conservative Leader urged the government to release the rejected agreement text, recall Parliament, and implement emergency economic actions to save jobs and reduce costs for Canadians. However, officials emphasized the government’s commitment to supporting workers and businesses, dismissing opposition criticisms.
Overall, the government’s comprehensive support measures aim to mitigate the impact of tariffs on Canadian workers and businesses, ensuring economic resilience and stability in the face of trade challenges.