Canada Showcases Economic Strength Amid Ongoing Tariff Negotiations

Canadians are shifting from their traditionally welcoming demeanor to a strong sense of nationalism in light of U.S. President Donald Trump’s critiques of the nation’s trade practices and sovereignty.

Trump’s postponed plans for a 25% tariff on Canadian imports and his suggestions that Canada might become part of the United States have angered many Canadians, leading them to boycott American products and enact other economic retaliations as an extraordinary display of patriotism.

“It feels to most Canadians like we’ve been betrayed; the person we trusted most is now assaulting us without clear reason,” stated Joel Bilt, a university economics professor specializing in international trade at the University of Waterloo in Ontario. “This has really brought people together.”

Stores have been promoting “shop Canadian” initiatives, displaying signs and labeling products made domestically in special ways. A popular Facebook group focused on Canadian-made goods has reported a membership surge, doubling in size since early February as the tariff saga unfolded.

According to a survey conducted by market research firm Leger, which surveyed over 1,500 Canadians between March 7 and March 10, more than 60% of respondents reported purchasing fewer American products, both in-store and online. Over 70% indicated they increased their consumption of domestically produced goods from Canada, which ranks as the ninth largest economy worldwide.

The Liquor Control Board of Ontario took drastic measures by prohibiting its members from ordering American alcoholic beverages. This move, which affects over $1 billion worth of American liquor sold annually, has alarmed U.S. spirit producers like Jack Daniel’s parent company, Brown-Forman.

“That’s more detrimental than a tariff,” remarked Lawson Whiting, CEO of Brown-Forman, during a recent earnings call. “It’s literally taking away your sales.”

In addition, Ontario plans to introduce a 25% surcharge on electricity exported to Michigan, Minnesota, and New York; however, Premier Doug Ford stated that this tax would be temporarily paused after U.S. Commerce Secretary Howard Lutnick agreed to restart negotiations.

Initially, Trump suggested raising tariffs on Canadian steel and aluminum to 50%, but the White House later confirmed that he backed off following the talks between Lutnick and Ford.

Despite this, Trump’s earlier plan for increased metal taxes put the United Steelworkers union—representing approximately 850,000 individuals across the U.S., Canada, and the Caribbean—on high alert. USW International President David McCall stated on March 11 that the North American branches of the international trade organization will “fight together” against the proposed tariffs, which he said threaten jobs on both sides of the border.

Even amidst ongoing tariff negotiations, travel to the U.S. is already feeling the impact, with returns by Canadian travelers from the U.S. by vehicle dropping about 23% in February compared to the same month last year, according to government data.

Government statistics also indicated that the number of Canadians flying back to the country from international destinations decreased in February from the previous year, reflecting a downturn in overseas tourism. This comes as Air Canada announced plans to reduce services to warmer U.S. destinations like Florida, Arizona, and Nevada starting this month.

Trump’s threats have even led to some cancellations at the Wildwoods in New Jersey, a favored beach spot for visitors from cities like Montreal and Quebec, as reported by Ben Rose, marketing and public relations director at the Greater Wildwoods Tourism Authority. However, he mentioned that these cancellations haven’t been as widespread as feared, with Canadians also showing concern about the exchange rate.

At consumer travel fairs in Toronto and Montreal, the authority has received feedback from prospective Canadian tourists indicating that Trump’s tariffs have dissuaded them from vacationing in the U.S. Rose’s team reassures anxious Canadians that America has been a hospitable destination for them over the years, providing unique opportunities within a short driving distance.

“Some of the resistance we’re hearing is something like: ‘We love Americans, and we know they love us, but we’ll catch up in four years,'” Rose observed. “They feel they cannot support the current administration.”

Canadians’ response to Trump’s policies has transcended into their culture and media, captivating the nation’s attention.

Canadians have booed the U.S. national anthem during major sports games against American teams. During a recent appearance on Saturday Night Live, Canadian star Mike Myers wore a shirt proclaiming “Canada is not for sale,” paired with the country’s red-and-white flag.

Tariffs have become a critical issue for Canada’s administration, which recently welcomed ex-central banker Mark Carney as its new prime minister, succeeding Justin Trudeau, whom Trump had mockingly referred to as “governor,” suggesting a desire for Canada to be incorporated into the United States.

The government of British Columbia along with its power authority announced the exclusion of Tesla from eligible green-energy rebates starting March 12, an initiative aimed at prioritizing Canadian-made alternatives. Tesla’s CEO Elon Musk has faced criticism for his involvement in Trump’s controversial government efficiency initiatives.

According to Bilt from the University of Waterloo, Canadians’ frustrations are directed primarily at Trump rather than the American populace; he believes that individual interactions between citizens of both nations are unlikely to deteriorate. However, he warns American enterprises should prepare for a Canadian market that is increasingly resistant to U.S. brands and travel until Trump alters his stance.

“This has really sparked an unprecedented level of response,” Bilt stated. “While Canadians are not typically nationalistic, this situation has struck a chord deep within the average citizen.”

— NBC News and CNBC’s Dan Mangan and Laya Neelakandan contributed to this report.

Disclosure: Saturday Night Live is an entity of NBCUniversal, which also owns CNBC.