April 15, 2025
The tariffs imposed on Canada by President Trump are taking a toll on one of the strongest trading relationships in history, says partner and co-head of Torys’ Direct Investment practice Guy Berman.
“Canada and the U.S. are, I don’t want to say inextricable linked, but they are hyperbolically linked,” Guy said in the April/May issue of the Private Funds CFO magazine. “Not just business, but culture. We are very integrated. The tariffs are really difficult for us to swallow.”
Considering Canada’s long-standing history of being one of the U.S.’s greatest allies and trade partners, the tariffs mark an unprecedented moment in the two countries’ histories with far-reaching impacts.
“We also recognize that this could have a devastating impact on our economy and our businesses,” Guy said. “But when [President Trump] started talking about us as the 51st state, Canadians got their back up.”
Not only have President Trump’s tariffs shaken the global economy, but they also came as a surprise to many—particularly leaders in Canada’s business community.
“It feels a little silly now, but some Canadian business leaders were very hopeful about Trump’s return to Washington,” Guy said.
“After Trump was elected, but before the tariffs were announced, there was some sense of optimism that you had someone who was very pro-business and would take away a lot of regulation, which could’ve been a real boon for investors.”
The uncertainty brought on by the tariffs, as well as President Trump’s mixed messaging about his feelings towards Canada, will inevitably impact cross-border transactions and investments, Guy says.
“Our clients underwrite risks. That’s the business they’re in. The tariffs are going to put a lot of weight on this. It’s really difficult for them to underwrite those types of deals. It’s hard to have conviction about purchase price when you don’t know if you’re looking at 25 percent tariffs, 10 percent tariffs—no one knows where this will end up.”
Despite the current tensions between Canada and the U.S. currently, there are opportunities for Canada to emerge stronger on the other side of the current environment.
“One of the big impacts of the Trump tariffs is it’s an opportunity for Canada to look at itself,” Guy said. “We have to ask ourselves, how can we be more competitive?”
To answer this question, Guy points to two “low-hanging fruits.” The first is addressing provincial trading restrictions, which could facilitate greater interprovincial trade within Canada and spur economic growth. The second is exploring other global trading partners that could boost Canada’s economic resilience by becoming less reliant on the U.S.
“That could be a real net benefit for Canada,” Guy says.
Press Contact
Richard Coombs | Senior Manager, Marketing
416.865.3815