The U. S. Supreme Court's recent decision to strike down tariffs imposed under the International Emergency Economic Powers Act (IEEPA) has been met with cautious responses from Canadian analysts and trade experts. While the ruling is a legal rebuke of presidential overreach, it doesn't necessarily translate to immediate safety for Canadian jobs.
Unifor National President Lana Payne stated that the risk to Canadian jobs remains severe, with the potential to increase if the U. S. seeks new ways to impose tariffs or target Canadian investments. The decision doesn't end the trade war against Canada, as industry-targeted Section 232 tariffs and other measures remain in place. These tariffs, impacting sectors like auto, steel, aluminum, and wood products, could even be expanded. Canada-U. S. Trade Minister Dominic LeBlanc acknowledged that critical work is needed to support industries affected by these ongoing tariffs.
Economists emphasize that the ruling's impact on the Canadian economy may not be substantial. The sectors not protected under the Canada-United States-Mexico Agreement (CUSMA) are those primarily affected by this ruling. Moreover, the U. S. may explore alternative legal avenues to reinstate or replace the struck-down tariffs. In fact, President Trump has already announced a 10% global tariff on top of existing duties in defiance of the ruling.
The Canadian Chamber of Commerce warns that Canada should prepare for new mechanisms to assert trade pressure, potentially with disruptive effects. While the removal of reciprocal tariffs could give Canada more bargaining power during the upcoming CUSMA renewal talks, the threat of tariffs remains a key concern. As CIBC chief economist Avery Shenfeld notes, it is unclear whether the new tariffs would bypass the CUSMA exemption.
