Days following the breakdown of trade negotiations with the Trump administration, the Canadian government has unveiled a $7.5 billion aid package to assist workers and businesses in coping with the new 50% tariffs imposed on $27.6 billion worth of Canadian exports by the U.S. president.
Finance Minister François-Philippe Champagne, along with other government officials, revealed on Tuesday that in response to the U.S. tariffs, Canada will impose equivalent tariffs on $27.6 billion worth of comparable American goods starting September 8.
“This presents an unprecedented challenge for Canada, but we are prepared to face it together,” stated Champagne during the announcement held at an Ottawa roofing company. “We are committed to supporting our workforce, businesses, and industries for as long as necessary.”
Government sources indicated that this new support initiative supplements the nearly $25 billion in tariff assistance provided over the past 18 months. The aid is specifically tailored to benefit workers and businesses, particularly small and medium-sized enterprises nationwide.
Under the support package, $3.5 billion of the total funding will be allocated to a swift response program for workers and employers. This includes extending existing Employment Insurance (EI) benefits, such as waiving the one-week waiting period and granting additional weeks for long-tenured employees.
Furthermore, new measures will allow voluntarily departed workers to access EI benefits without penalties and facilitate the connection of unemployed individuals with high-demand projects. Employers will receive up to $1,000 per employee to cover training and administrative costs for implementing EI work-sharing programs.
In addition to these measures, the government will invest $2 billion in establishing the Canada Strong Diversification Fund to support companies impacted by tariffs with capital maintenance projects. Larger firms will benefit from extended repayment terms under the Large Enterprise Tariff Loan facility.
Medium-sized enterprises will have access to an extra $1.5 billion in funding through regional development agencies, which includes higher grant limits and interest-free loans to support their operations. The Business Development Bank of Canada will also offer working capital support to smaller businesses facing financial strain due to the tariffs.
Canada’s retaliatory tariffs will mirror those imposed by the U.S. on Canadian products, with a focus on protecting domestic industries rather than generating revenue. The government aims to match U.S. tariff rates on comparable products and has targeted American goods where Canadian alternatives are available.
Prime Minister Mark Carney recently briefed opposition leaders on the government’s response to the escalating trade tensions with the U.S., emphasizing the need for a unified approach to safeguard Canadian interests and jobs.
Following the briefing, NDP Leader Avi Lewis expressed support for the government’s stance on negotiations. In contrast, Conservative Leader Pierre Poilievre called for additional economic measures, prompting a rebuttal from Industry Minister Mélanie Joly, who highlighted the government’s commitment to supporting workers and businesses.
As tensions persist, Canadian officials remain resolute in their efforts to mitigate the impacts of the tariffs and uphold the country’s economic interests.
