A recent report has cautioned that the breakdown of the Canada-U.S.-Mexico Agreement could result in significant job losses and economic repercussions for both countries. The analysis, conducted by Oxford Economics for the Canadian American Business Council and released on Monday, explored the potential outcomes of the ongoing trade negotiations between the U.S. and Canada.
The report outlined three scenarios: the maintenance of current tariffs, the collapse of the CUSMA agreement, and a successful renegotiation leading to an improved trading relationship. It projected that if CUSMA were to end, approximately 214,000 American and 102,000 Canadian jobs would be lost compared to the status quo. Conversely, successful renegotiation could result in the creation of 137,000 jobs in the U.S. and 98,000 in Canada.
Beth Burke, CEO of the Canadian American Business Council, emphasized the importance of the trading relationship between the two countries, stating that the findings underscore the impact on jobs, security, and stability for both Canadians and Americans.
The repercussions of a breakdown in the agreement would extend to the GDP of both nations, with the U.S. economy facing a potential loss of $1.04 trillion USD and Canada $271 billion CAD by 2035. Inflation rates would likely rise in the short and long term, while real disposable income growth, especially in Canada, would be hindered.
On the worst-case scenario outlined in the report, manufacturing sectors in the U.S., including auto, wood product, and metal product manufacturing, would be severely affected. Similarly, Quebec and Ontario in Canada would bear the brunt of the impact in terms of job losses and economic repercussions in the manufacturing industry.
Efforts to Reach a Trade Agreement Continue
As the deadline approaches for potential new tariffs on Canadian products, officials are working to negotiate a deal before the impending deadline. Trade Minister Dominic LeBlanc and U.S. Trade Representative Jamieson Greer are engaged in discussions aiming to present a possible trade deal to President Donald Trump by Monday.
Burke expressed optimism about the ongoing negotiations, indicating that concessions may be necessary from both sides to reach a successful agreement.
In light of potential new tariffs, a recent report by Oxford Economics highlighted that manufacturers of cement, concrete, paper products, wood, computers, electronics, plastics, and rubber would face substantial impacts. Provinces like Ontario, New Brunswick, and Quebec are predicted to be the most affected due to their reliance on these manufacturing sectors.
Tag: rewrite-pending