Canadian politicians, business leaders flock to Washington for Trump’s inauguration with trade relations on the line

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Inauguration-day tickets to the Canadian embassy in Washington have always been a coveted commodity. With a view that overlooks the U.S. Capitol, the embassy occupies a prime location in keeping with Canada’s long tenure as the closest of U.S. allies.

Those who attend can watch the festivities while nibbling canapés and rubbing shoulders with political eminences. But for the Canadian business leaders and politicians now descending on the U.S. capital, Monday’s inauguration of Donald Trump promises to be unlike any other.

Not only has a forecast of frigid weather moved the ceremonies indoors, but Mr. Trump has called into question whether Canada still enjoys a place of privilege with its closest neighbour and most important trading partner.

With that uncertainty hanging in the air, the inauguration “is a hot ticket. Everybody wants to be in town,” said Jeff Gaulin, global head of corporate affairs for Toronto-based Vale Base Metals.

At the embassy, some 1,800 people are expected – a mix of nationalities, personalities and spectators to one of the political world’s great spectacles. Canadians have always sought to press an advantage with an incoming presidential administration and its acolytes.

This year, however, they will arrive prepared to defend what they already have, armed with facts and statistics to bolster arguments against the imposition of Mr. Trump’s threatened 25-per-cent tariffs. They have also sought to marshal arguments from a long history of co-operation, including in energy.

It was 130 years ago, for example, that the first natural gas crossed the border from Ontario to Buffalo, N.Y., said Jay Averill, a spokesperson for the Canadian Association of Petroleum Producers, which has sent some of its top leadership to Washington for the inauguration.

“This is an incredibly valuable relationship for both countries and for many of our members,” he said.

Today, Canada supplies nearly a quarter of U.S. oil demand.

François Poirier, chief executive of TC Energy Corp., is among the Canadian business leaders who came to Washington this weekend. The company looks forward to working with Mr. Trump’s new administration “on efforts to promote a stable, predictable and efficient permitting process that unleashes energy across North America,” Mr. Poirier said on social media.

TC Energy was the corporate backer of the Keystone XL oil pipeline, whose permit President Joe Biden revoked on his first day in office.

Mr. Trump’s pledge to impose tariffs on Canadian goods has created broad anxiety across this country’s corporate sector. The president-elect appears determined to carry through with tariffs, Alberta Premier Danielle Smith told reporters after meeting him in Florida on Jan. 11.

She came to Washington this weekend, posing for pictures Saturday with North Dakota Governor Doug Burgum, who has been nominated for interior secretary, and Chris Wright, whom Mr. Trump has picked as his energy secretary.

Ms. Smith has threatened a national unity crisis if Canada’s federal government interferes with the province’s oil and gas exports to the U.S. The measure has been floated as a means of retaliating against American tariffs, and Ottawa has not ruled it out.

Over the weekend, however, the Premier also sought to counter Mr. Trump’s concerns over a sizeable trade imbalance with Canada. Remove fossil fuel exports from the calculation, she said on social media, and the U.S. actually maintains a $58-billion trade surplus with Canada.

Canada’s corporate sector has called on Ottawa to play simultaneous offence and defence – responding to tariffs while also strengthening itself domestically.

“We need to get a number of things done well here. Build infrastructure. Diversify our markets. Fix our immigration system,” said Goldy Hyder, who leads the Business Council of Canada and who was also in Washington on Sunday.

Corporate Canada has renewed calls for provinces to cut domestic trade barriers that, advocates say, constitute a greater drag on the country’s economy than that expected from U.S. tariffs.

Canada should also take much more seriously its commitments to defence spending, Mr. Hyder said.

The U.S. “will not reward you for being weak. They will take advantage of you,” he said. “So don’t be weak. Strengthen your home base.”

But the message to the U.S. is that “tariffs hurt Americans,” said Candace Laing, president and chief executive of the Canadian Chamber of Commerce, who was also in Washington.

The chamber has warned that a 25-per-cent tariff on Canadian goods would threaten 1.4 million U.S. jobs and cost American households more than US$1,000 each annually, with gasoline pump prices in the Midwest climbing by as much as US$0.75 a gallon. (The estimated cost to Canadian households is even higher, at C$1,900 a year.)

But finding the right audience for that message has proven difficult. The incoming second Trump administration includes “a smaller inner circle that’s harder to get the facts to,” Ms. Laing said.

Mr. Trump could institute some tariffs as soon as Monday, in the hours after he is sworn in as president: “I will act with historic speed and strength,” he told a rally on Sunday. So Canadians, Ms. Laing warned, should “brace for impact.”

Canada’s auto sector is typically held up as a model of industrial integration, with parts crossing the border many times in the manufacture of a vehicle. But industrial commodities have also been built around seamless border operations.

Take Red Dog, the largest zinc mine in the world, which is operated in Alaska by Vancouver-based Teck Resources Ltd. Zinc concentrate from the mine is shipped to the southern interior of B.C. There, “it is converted into refined products, including germanium, and sold to customers primarily in the United States,” said Dale Steeves, a Teck spokesperson.

Nickel follows a similar cross-border course. The sole U.S. nickel mine is located in Michigan’s Upper Peninsula. Its output is shipped to Canada for refining, before being sold back to the U.S.

In 2022, the U.S. “imported 130,000 tonnes of nickel. Seventy per cent of that came from one nickel refinery in Sudbury – ours,” said Mr. Gaulin, the Vale executive, who is among those travelling to Washington for the inauguration.

Vale’s statistics show that Canadian-supplied nickel meets more than half of the demand from U.S. defence industries, and 80 per cent of what is used by U.S. aerospace. Nickel helps to build the machines that process artificial intelligence and satellite telecommunications.

“It goes into bombs, it goes into bullets, it goes into tanks, it goes into batteries,” Mr. Gaulin said. Five of the top nickel-importing states in the U.S. vote Republican, and “in the near-term, America has limited alternative supply sources,” he added.

“So American consumers will pay more.”

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