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Ontario, Canada's most populous province, announced on Monday that it was banning US companies from provincial contracts and cancelling a 100 million Canadian dollar contract with Elon Musk's Starlink in response to tariffs announced by US President Donald Trump on Canada.
Beginning Tuesday, Trump said on February 1 that the US will impose 25 per cent tariffs on virtually all Canadian imports excepting oil, which has a 10 per cent surcharge. If the measures are prolonged, the Canadian economy will go into recession.
Ontario Premier Doug Ford, one of the more hard-line premiers on the question of retaliation, said the province will not do business with "people hellbent on destroying our economy". He also said that US-based businesses will now lose out on tens of billions of dollars due to Trump.
"Starting today and until US tariffs are removed, Ontario is banning American companies from provincial contracts. Every year, the Ontario government and its agencies spend USD 30 billion on procurement, alongside our USD 200 billion plan to build Ontario," Ford tweeted.
"US-based businesses will now lose out on tens of billions of dollars in new revenues. They only have President Trump to blame. We're going one step further. We'll be ripping up the province's contract with Starlink," he said.
Under the terms of the deal, which Ontario signed in November last year, Starlink was to provide high-speed internet access to 15,000 eligible homes and businesses in more remote communities.
Ford said, "Ontario won't do business with people hellbent on destroying our economy. Canada didn't start this fight with the US, but you better believe we're ready to win it."
Trump signed an order imposing hefty new tariffs of 25 per cent on goods from Mexico and Canada and 10 per cent on imports from China, threatening to ignite a trade war that could disrupt more than USD 2.1 trillion of annual trade.
The tariffs were announced by Trump after he accused Canada and Mexico of being sources of illegal narcotics and immigration to the US.
In a tit-for-tat move, Canadian Prime Minister Justin Trudeau announced that Ottawa will impose 25 per cent tariffs on USD 106.5 billion of US goods. He said the coming weeks would be difficult for Canadians, but that Americans would also suffer from Trump's actions.
Trump said he spoke to Trudeau amid the threat of a major trade war impacting the world's two largest trading partners. In his post on Truth Social, Trump discussed with Trudeau about drug trafficking at the border and said he would speak to him again after 3 pm (ET).
Trudeau's office did not respond to a query as to how the call had gone. He is due to speak to a special advisory council on US-Canada relations later on Monday.
In a related development, Mexican President Claudia Sheinbaum announced on Monday that the United States has agreed to suspend the implementation of President Donald Trump's tariffs on Mexican goods for one month. The Mexican President said that the development came after a "very good conversation" with the Republican.
In a statement on social media, Sheinbaum revealed that after her conversation with Trump, Mexico would immediately deploy 10,000 Guard soldiers to its northern border to curb the flow of illicit drugs into the US, with a particular focus on fentanyl.
(with inputs from Reuters)
Published By:
Prateek Chakraborty
Published On:
Feb 3, 2025
