Canadian Dintech & Trade at risk between the threat of US Tariff

Global Trade | Jan 29, 2025

Picture: Navigating the Global Financial System System (Wef)

How US tariffs can change the global trade system and Canadian effect

The tariffs come. The tariffs come.

Less than a week ago since President Trump’s inauguration and the economy of the world has become easier, and Canada was caught in the middle because US threatens to slap a 25% tariff of Canadian February 1 changes, which signifies conflicts in February history. This is another David against Goliath Batt.

This article comes from two reports that the tariffs will structure the global trade system, the flow of supply chains, causes to prepare markets and investors and those investors, as they are preparing for the end result. The first is a report by Hudson Bay Capital called ‘Users guides the system to the global trading system‘(41 pdf, Nov 2024) and the economic economic world’Navigate to the Global Financial System System‘(46 pdf, Jan 2025)

Why did the US impose tariffs?

The short answer for a variety for different reasons, most economic and / or political reasons. A key motivation is Great country debt in America have passed $ 34 trillion. Tariffs are a tool in Increase government income while distressing dependent on foreign imports. If imported goods become more expensive, American consumers and businesses will waste things done locally, supporting local production and making.

We all know Trump wrote the book ‘The art of agreement‘(Way back to 1987). Good tariffs can and can used as a negotiation tactic If renegotiating CusmeiTrade Trade Agreement where reported to have to take place while we speak. they Protectionist measures that can reduce trade defaults As estimated USD $ 55 billion shortage of goods US in Canada last year (see Trade Gap for the past 10 years), and appears as an economic strategy to realigns global supply chains.

See: Davos 2025 Themes and Toulaway for Fintech

Tariffs can also be used to protect critical sectors such as energy, technology or defense to appear as a risk of Successful in the country. It is different from penalties that are more accurate and can prevent access to financial systems. The US uses two former tools, the tariffs of revision of trade policies and geopolitical rivals. However, the two methods reflect the fashion of Major Economies leading to economic dryness in globalization Causes bad ripple effects for countries with small economies dependent on strong trade relations such as Canada.

Canadian vulnerability to form the BROC in Trade

Warned by wef ‘The firmin framentation is increasing with many economic economic trading and financial blokes (alliance) that can change world investment standards and Reduce Global GDP to USD $ 5.7 trillion and add inflation to the whole world.

As US enforcement of many protectionist policies to carry out national control chains (while reducing dependent on foreign markets such as China, Mexico or Canada), caught in economic risks. Wef reports warn that ‘neutral economies’ can face reduced market access if they fail to engage in or align policies of dominant trade groups. For Canada, stakes are very high in most of our exports to go to the US (and most of the oil). Losing favorite access to any US market or developing trading blocks are harmful.

So ask questions, which Sale options are potential options to consider beyond the US?

• There is the Comprehensive and progressive agreement for Trans-Pacific Partnership (CPPPP), strengthen relationships within an Asia-Pacific Bloc to increase trade with economies such as Japan, Vietnam, and Australia.
  
• Canada can deepen the interaction with the European Union by Confective agrective agrective areconomy areconomy and trade (CETA) To beat American protection policies.
• Canada can check new agreements in regions experiencing economic growth such as Pacific Alliance (Mexico, Peru, Chile, Colombia) and / or the Free area of ​​African trade (Afcfta).
• And while politically very complex, Canada can also look at trade agreements Brics Countries (Brazil, Russia, India, China, South Africa) on a selectable basis, especially for specific sectors such as energy and agriculture.

See: Ceta opened doors in EU markets for three years

That’s the theory. In practice, Canada exports raw materials to most US and trading with countries around the world can be a new challenge and the past to be difficult. Both reports warn the risk that tariffs can result in long term trade transfer and financial supply chains, disabilities, higher economic growth. If Trading Blocs Harden without an involvement in Canada, Canadian companies can face many obstacles to capital flow and access to the financial market.

Implications for Canadian Fintech markets and investments

If access to the US and global capital Pightens, invest in Canadian Startups in Fintech will be less. The fintechs should look more difficult and further arrival to raise the capital and sell to new markets with different rules and compliance costs. While governments are back to financial sovereignty, global payment networks and debris dependent them may face new restrictions.

As tariffs make products more expensive for consumers, Inflation risks and money change can cause Canada dollars to pressure. Higher prices of inflation and stimulating can hurt stock markets with investors that turn into safe havenes such as gold, bundles or maybe bitcoin for cash risks.

What are the fintechs, investors, and policies?

Good first, we need Wait until February 1 to see if the tariffs continue to and find out what it looks like. For example, does the economic impact of the economy are set if some items are released from tariffs such as oil and gas in Canada?

Then if so, the Canadian fintech should prepare for worse. This means companies should Prioritize home market development while also varies with new trading blokes Where related and regulatory scenes open and digital financial adoption Grows. the The local fintech ecosystem must be established With collaboration between finsechs and financial institutions such as banks and credit unions to build strength.

See: Trump Tarko: Effect Digital Tax in Digital Canada

Investors need Check exposure and effect to a more broken financial system in their portfolio and Consider eating the seizure against hostility. Investors may also think of focusing on domestic fintech markets.

Canadian policies need Good participation in trade negotiation, Like Cusma with US / Mexican, to try and protect more market access. They should be Strengthen Existing Agreements and check out the new Sale Agreement. Canadian government should Support home repair programs and invest and work to get unnecessary frictions / loads while encourages the adoption of increasing, and of course the fintech infrastructure rush is like a payment and Open the banking.

Last thought

World trade systems and world financial systems change and Canada may have no choice other than adaptation. Policy, business and investors should be active in understanding the impact and making appropriate strategic decisions to lighten real estate risks.

the National Crowdfunding & Fintech Association . Industry in Canada. Decentralized and distributed, NCFA associated with stakeholders and helped incubate projects and investments, blockpoin, Blockpoin, Cryptopurency, remtech. contribute Canada & Community Community Community today is now free! Or to be a Contributing member and get perks. For more information, please visit: www.ncfacanada.org