“We’re thinking in terms of 25 per cent on Mexico and Canada because they’re allowing vast numbers of people — Canada is a very bad abuser also — to come in and fentanyl to come in,” Trump said. “I think we’ll do it on Feb. 1. On each.”

Prime Minister Justin Trudeau had earlier acknowledged only that Trump’s inaugural address revealed no punishing tariffs on Canadian products “for now.”

But nobody in the federal Liberal government had assumed Canada would escape unscathed from Trump’s new review of “unfair” trade relations and vow to fill America’s coffers with tariff revenue.

By evening, Trump was riffing on tariffs and a whole range of topics with reporters gathered in the Oval Office, as he continued to sign executive orders, as he had throughout the day. 

It came long after his inaugural address Monday morning. At that time, Trump made clear he has foreign manufacturers and America’s allies and competitors in his crosshairs, promising an “overhaul of our trade system to protect American workers and families.”

Trump initially stopped short of imposing his threatened 25 per cent tariff on Canadian and Mexican goods — a move the Trudeau government has said would “devastate” Canada’s economy and hurt American businesses and consumers forced to pay more for Canadian energy, minerals, food and agricultural products.

However, as part of a revived “America First” trade policy, Trump announced the creation of an External Revenue Service to scoop up tariff and tax revenue from foreign countries, saying he was “saved by God to make America great again.”

Trump promised to put American manufacturers, automakers and workers first. 

Earlier when asked whether Canada had escaped the worst, LeBlanc said “reprieve” was too strong a word. Other ministers said they were “encouraged” or “motivated” by a chance to keep making the case, as they have for months, that Canada is integral to American economic and national security.

When Trump’s first administration called for a renegotiation of the North American Free Trade Agreement, the first Trudeau government said it welcomed the challenge and would seek progressive changes in a new deal. (Neither got exactly what it wanted out of that first renegotiation.)

On Monday, LeBlanc attempted to present a similarly rosy view of the rocky road ahead.

“If the administration wants to study the economic and trade relationship between Canada and the United States, we think that’s a positive opportunity for us to continue to tell the Americans and obviously Canadians as well, the importance of working together and how both countries are stronger and more secure when we respect and honour a comprehensive free trade agreement,” he told reporters.

But few are under any illusion that the challenge is the same.

Trump, surrounded by a more hawkish group of advisers, returned to office with a clear blueprint that was immediately posted on a remade White House website, as the president declared a series of national emergencies to deploy soldiers to the Mexican border, ramp up oil drilling, end electric vehicle mandates, and to launch his trade review.

“Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens,” Trump said.

Premier Doug Ford and Alberta Premier Danielle Smith had warned that uncertainty remains, with Smith saying “despite the promising news today, the threat of U.S. tariffs is still very real.”

Smith urged Canadian federal and provincial leaders to stop talking about “retaliatory measures including export tariffs or cutting off energy to the U.S.” and instead allay Trump’s concerns through tighter border security, more defence spending, tougher immigration policies, and the repeal of “anti-energy” policies.

Ford suggested he’d need a new electoral mandate to navigate the unknowns ahead.

“I’m not saying that we won and it’s over,” said Quebec Premier François Legault.

In an official statement, Trudeau congratulated Trump on beginning his second term, and reminded him that “Canada and the United States have the world’s most successful economic partnership.”

“We are each other’s largest trade partners, with a relationship that creates millions of jobs, attracts billions in investment into the continent, and keeps our people safe,” he said.

Trudeau and successive cabinet ministers argued it is a “mutually beneficial relationship,” and reminded Trump that the government has made “massive investments” to bolster cross-border trade, reinforce supply chains, and “create jobs on both sides of the border.”

Ottawa has marshalled reams of statistics to prove the stakes are high, saying eight million jobs in the U.S. are tied to trade with Canada, with about 70 per cent of Canadian goods exported to the United States used in the production of other goods.

And it says that if Canadian energy exports to the U.S. are excluded from the equation, the U.S. has had a merchandise trade surplus since 2007, standing at US $28.6 billion in 2023.

Trade is only one of Canada’s concerns. The possible influx of people fleeing deportation orders is another.

Immigration Minister Marc Miller told the Star that for now, Trump’s focus is on his country’s southern border “but it would be naive not to expect an uptick here” in border crossings as a result of Trump’s deportation orders.

“It’s really cold so it’s more dangerous than normal,” Miller said, “but be that as it may, if people turn up at the (northern) border they’ll be turned away as per the Safe Third Country Agreement.”

In Washington, Trump said he would reverse the Biden administration’s “green New Deal” policies, which included not just EV mandates but billions of dollars in tax credits to support electric vehicle manufacturing, in order to save “our auto industry and keeping my sacred pledge to our great American autoworkers.”

Industry Minister François-Philippe Champagne attended the inauguration at the U.S. Capitol Building, watching the ceremony from an overflow room among a number of Republican state governors. In an interview on CBC, he downplayed the fallout of any end to EV mandates, noting one of Trump’s biggest financial supporters, Elon Musk, sells EVs and the industry will continue to attract investment as the world seeks to decarbonize.

Canada’s own subsidies of EV companies have been tied to the existence of American subsidies, and if the U.S. ditches its tax credits, Ottawa has previously said it would, too.

Canadian officials first learned Trump would not impose tariffs on day one when the Wall Street Journal broke the story Monday morning, ahead of the inauguration, that Trump would instead sign a memo ordering a trade deficit review which would include a study of the North American Free Trade pact.

The newspaper said it singles out China, Canada and Mexico for scrutiny, directing agencies to assess Beijing’s compliance with its 2020 trade deal with the U.S., as well as the status of the Canada-U.S.-Mexico-Agreement (CUSMA), the updated version of the North American Free Trade Agreement, which is set for review in 2026.

One senior federal official said Trump’s action could represent a serious threat down the road.

Trump also announced the U.S. withdrawal from the Paris Accord on climate change, the same agreement he pulled out of during his first administration. 

Environment Minister Steven Guilbeault said America’s withdrawal is disappointing, but individual U.S. states are engaged in the fight and that won’t change.

“The fact that the federal government in the U.S. will no longer be interested in fighting climate change doesn’t mean that the United States of America, as a whole, is not interested in that, and the international community will continue moving forward, with or without President Trump,” he said.

Guilbeault added that the president’s timing is “quite ironic … as California is going through one of the worst forest fire seasons in its history.”

Since November, Trump has threatened 25 per cent tariffs on imports from Canada and Mexico, and an additional 10 per cent tariffs on China. That was a significant escalation of his election campaign vow of 10 per cent global tariffs on all imports.

Now it’s a wait-and-lobby-harder game for Canadian political and business leaders.

The Canadian government had planned a series of escalating reciprocal tariffs on American products if Trump moved ahead as early as Monday.

Ottawa is also looking at ways to support Canadian businesses and workers if an all-out trade war erupts.

It could take weeks and months for the tariff dispute to play out — if Trump does in fact move to impose them.

With files from Ryan Tumilty and Raisa Patel