The Trade Brief: Not a Brand New Day
Author’s note: Last month, we marked the Trade Brief’s first birthday with a special video featuring the people who help make it happen. Members of BCC’s International team shared their reflections on a year of tumultuous trade and what they think might be around the corner.
Check it out here, if you missed it.
Summer is basically over, not that we had enough sunshine to call it a proper one (at least for those of us living in the Nation’s Capital).
August kicked off with Spider-Man: Brand New Day. New chapter, clean slate, a fresh start.
Then reality hit. Instead, August gave Camp Rock 3 energy: familiar drama, recycled plotlines, and a sequel that left us wondering why it was needed in the first place.
No amount of superpowers could have saved us from the familiar villains (aka tariffs and tensions) lurking in every corner, spinning an increasingly complicated web of global trade.
Still, there were a few plot twists:
- Not-so-friendly neighbourhood tariffs
- Swinging exports
- Into the free trade-verse
- With great critical minerals comes great power
YOUR NOT-SO-FRIENDLY NEIGHBOURHOOD TARIFFS
For most of August, the U.S. and Canada were engaged in high-stakes negotiations that had everyone holding their breath.
Negotiators spent weeks exchanging proposals and holding daily discussions in an effort to avoid new 50% tariffs that were set to take place August 19th.
ICYMI: On July 20th, the U.S. announced new 50% tariffs on $28 billion worth of Canadian goods that were set to come into effect on August 19th, claiming that Canada is discriminating against its dairy, alcohol and auto sectors.
For a few days, there, it seemed that those tariffs would be avoided and Canada might get relief from the longstanding 232 tariffs on steel, aluminum and auto sector.
There was no shortage of optimistic headlines – but we were quickly reminded it was only the second act of the movie.🎬
When the talks collapsed, U.S. tariffs were imposed and Canada introduced retaliatory measures.
Let’s take a look at what transpired in the last couple weeks:
August 18th: President Trump pauses the 50% tariffs for 3 days to give negotiators more time to hash out a deal.
⭐Three days later…⭐
August 22nd: Negotiations failed. No deal. Tariffs kicked in at midnight.
August 25th:
- Canada clapped back with dollar-for-dollar counter tariffs on $27.6 billion worth of U.S goods.
- The federal government also unveiled $7.5 billion in support for workers and businesses caught in the trade crossfire.
- From steel and furniture to cheese and seafood, a wide range of American goods are about to get more expensive entering Canada.
August 26th: Online meme-war began.
August 27th:
- Canada released its retaliatory tariff list set to take effect on September 8th.
- President Trump signed an executive order renaming “Lake Ontario” to “Lake America”.
Meanwhile, Mexico is watching this telenovela unfold from the sidelines.
While Washington and Ottawa spar over tariffs, Mexico is quietly advancing its own negotiations with the U.S. and seeking tariff relief from steel, aluminum, autos, and auto parts.
Now that the spider is addressed, let’s see how the rest of the world is doing.
exports are swinging
The term “trade surplus” keeps getting thrown around.
Canada posted an international trade surplus (for the fourth month in a row) in June thanks to strong exports increasing from $3.7 billion to $3.9 billion.
Okayyyyyy Canada, we see you.👀
(Knock on wood, let’s not jinx it.)
However, this isn’t just unique to Canada.
The Eurozone’s trade balance chose recovery
After posting a €9 billion deficit in May, the bloc returned to surplus territory in June, helped by a surge in chemical exports and stronger demand for European goods.
Exports in Germany continue to do the heavy lifting💪, helping the country’s GDP grow 0.3% in the second quarter.
Switzerland also reported a high second quarter, with GDP surging 1.5%, the fastest since 2021 thanks to pharmaceutical and chemical exports.
Not a bad month for the region.
Into the free-trade verse
India:
The Indian government lifted its wheat export ban in an effort to boost the global supply of wheat.🌾
Wait, it was banned???
The ban first came into effect in 2022 after global wheat prices skyrocketed🚀 because of Russia’s invasion of Ukraine, prompting India to keep a bigger supply at home.
India is also on an FTA signing spree.✒️
Trade Minister Piyush Goyal said India is negotiating 8-9 Free Trade Agreements worth around $15 trillion, expanding its market access to cover 75% of global trade🌍.
That’s like…alot.
And let’s not forget the Comprehensive Economic Partnership Agreement (CEPA) Canada and India hope to sign this year.
Just last week, India’s Minister of Finance and Minister of Corporate Affairs, Nirmala Sitharaman was in Canada to meet with her counterpart, François-Philippe Champagne.
Bangladesh wants to make things official; with the European Union
Officials are saying that a FTA is in the works between Bangladesh and the EU setting the stage for an economic relationship worth more than €23 billion* in annual trade.
*Terms and conditions applied, obviously.
Bangladesh will need to strengthen trade rules, intellectual property protections, and the regulatory environment before any deal can cross the finish line.
with great critical minerals comes great power
Critical minerals are no longer just commodities.
They’re leverage.
Many western countries are trying to build critical mineral supply chains and that means bringing in some heavy hitters like Australia, Canada, Japan, Europe, and India.
Why now?
Critical minerals power EVERYTHING from AI and EVs to semiconductors, weapons and the energy grid.
So naturally, everyone wants to diversify and secure their critical minerals
Uzbekistan’s getting in on it
More than 30 critical minerals have been identified across the country, with 76 investment projects worth roughly €2.4 billion already underway.
It plans to expand its critical minerals list and processing of tungsten, molybdenum, graphite, lithium, tantalum and niobium while signing cooperation agreements with the EU, U.S., Canada, South Korea and China.
Argentina’s got the goods, but not the control
The country’s massive lithium and copper reserves have become a whole lot more strategically important to Beijing and Washington.
But with authority over natural resources spread across provinces, the country lacks a unified system to track production, regulate projects or even know where much of its lithium ultimately ends up.
in conclusion
And that’s a wrap on August.
No Brand New Day, just back-to-school season, unfinished trade drama and the inevitable 2 a.m. headline we all pretend we didn’t see.
Onto the September scaries.
Here are a few recommended readings:
