On Monday, January 6, 2025, Justin Trudeau, the Prime Minister of Canada, declared his resignation, referencing internal party disagreements and decreasing support, as Donald Trump proposed the idea of Canada becoming the 51st state of the United States as a measure to evade impending tariff threats.
Trudeau announced his decision to step down amid increasing pressure after his close ally, Deputy Prime Minister Chrystia Freeland, resigned in December 2024. Trudeau will continue in office until the Liberal Party appoints a new leader. His decision comes as his approval rating has plummeted to 19%.
When asked about Trump’s proposition of Canada becoming a part of the United States, Trudeau responded, “Not a snowball’s chance in hell.” He characterized Trump’s statements as a bargaining strategy to gain an advantage in future trade talks.
On Truth Social, Trump claimed that “many people in Canada LOVE being the 51st State” and floated the idea of a U.S.-Canada merger. He suggested such a union would eliminate tariffs, significantly reduce taxes, and make Canada “TOTALLY SECURE from the threat of the Russian and Chinese Ships that are constantly surrounding them.”
Trump’s annexation suggestion coincides with his threat to levy 25% tariffs on Canadian goods, a threat that Canadian officials are not taking lightly. Finance Minister Dominic LeBlanc dismissed Trump’s statements about statehood as “sowing confusion” and “creating chaos.”
Doug Ford, Premier of Ontario, cautioned about economic repercussions if Trump goes ahead with the tariffs. “The US will feel pain if Trump doesn’t back down from his threats,” Ford said, asserting that Canada would never become a part of the United States.
Canadian officials have started preparing potential retaliatory measures, including tariffs on American orange juice, toilets, and certain steel products. If Trump executes his threatened tariffs, these measures would target a broad range of U.S. products imported into Canada.
The Liberal Party faces the challenge of choosing a new leader, with notable contenders including Mark Carney, former governor of the Bank of England and Bank of Canada, and Chrystia Freeland, a former Deputy Prime Minister. As the following general election approaches, which must occur before October 2025, the Liberals are trailing behind the opposition Conservative Party in public opinion polls.
The timing of Trudeau’s departure poses distinct challenges for Canada-U.S. relations. During this critical period, Canada will be led by a “lame duck” Prime Minister, as Trump has threatened to implement the tariffs on his first day in office. This situation is further complicated by the expectation that key cabinet ministers involved in Canada-U.S. relations will join the Liberal leadership race.
Canadian Foreign Minister Melanie Joly, who won’t be running for the Liberal leadership to concentrate on U.S.-Canada relations, confirmed that the cabinet is preparing a comprehensive list of retaliatory measures. The government intends to target U.S. exports specifically from regions known to be Republican strongholds, mirroring their approach in previous trade disputes.
Economists caution that Trump’s proposed 25% tariffs could trigger a recession in the Canadian economy and further devalue the Canadian dollar. Canada is contemplating the imposition of export taxes on strategic commodities like oil, uranium, and potash to influence American energy prices.
In his parting words, Trudeau stressed the significance of preserving strong U.S.-Canada relations while safeguarding Canadian interests. “Canadians are proud of their identity,” he said, noting that collaboration with the U.S. remains crucial despite current tensions.