Yukon Premier Ranj Pillai has concerns about what a potential 25-per-cent tariff could mean for copper, the Yukon’s biggest export item into the United States over the last number of years. That’s if president-elect Donald Trump follows through on his threat, posted to Truth Social on Nov. 25, to slap a 25-per-cent tariff on “ALL products (sic)” coming to the U.S. from Canada and Mexico in one of his first executive orders.
“I think all Canadians have great concern about the potential tariffs. It could be very significant for the future of Yukon's economy if there is a 25-per-cent tariff put on things such as critical minerals,” Pillai told the News by phone on the morning of Nov. 28.
“It's incredibly important that we have the right market climate to have flow of critical minerals between our countries to ensure the security, to ensure that we have the right materials for the security needs we have, whether it be defence, communications or other areas of innovation.”
The Yukon is posed to provide 27 of 34 critical minerals.
Pillai noted the market for critical minerals has been “dominated by one or two countries” — namely, China and Russia. Those two countries are named among some of the biggest risks to the Yukon in a recently released report by the Yukon’s Arctic security council.
Pillai fears the tariff threat, if followed through on, could place additional barriers on places like the Yukon, where he said organizations are potentially looking to manufacture and export across Canada and into the U.S. He wants to keep the market in a position where individuals or companies still look to invest in the territory’s economy and have the proper markets available to them for export.
“It's very difficult now to define what the true economic impact will be without knowing which materials or products will have a tariff on them,” he said.
Consumers in the Yukon could see the Canadian dollar lose value, per Pillai. He said barriers on export in areas like critical minerals could have effects on the service sector that supports exploration companies and First Nation development corporations that have partnerships on those kinds of projects.
“I think it's something we'll feel at the at the grocery store, potentially, and in the retail sector, on our buying power, and our overall economy can be affected,” Pillai said.
Pillai indicated there’s been great interest in critical minerals in meetings he’s had with diplomats from Japan, Korea, Taiwan and Europe.
“When it comes to critical minerals, there is a ferocious appetite across the world,” Pillai said.
“But, you know, we want to secure North American borders. We want to be working with, you know, with our long-term partner, which has been the United States, and we think that's key to keep that flow of goods happening in the most optimized way.”
Trump’s social media post indicated the tariff would stay in effect until fentanyl and migrants stop flowing into the U.S.
Pillai spoke with the News the morning after a two-hour virtual meeting with Prime Minister Justin Trudeau and premiers that the premiers had demanded.
“I think it's important to note that the feeling from the phone call was that there was a real commitment from premiers as well as federal officials and the prime minister to work together on a Team Canada approach,” Pillai said.
“That's something premiers wanted to hear, but they want to be part of that strategy and part of that work.”
In the short-term, Pillai said there’s a commitment primarily from provinces to ensure that borders are “strengthened."
Doing that work requires more capacity at border crossings, per Pillai.
Pillai said he flagged to federal officials the importance for premiers to be included on cross-border work, whether that involves using existing relationships or being at the table with American officials.
Based on information the premier has received, he said the flow of drugs like fentanyl and migrants from the Yukon into Alaska over the shared Canada-U.S. border isn’t a “major issue.”
“It's really about the chemicals that are used to produce fentanyl coming into ports in places like British Columbia and ensuring that we stop the ingredients from coming into our country,” he said.
Pillai has tasked officials in the Yukon with setting up briefings with the Canada Border Services Agency to better understand any new trends here.
“I want to be assured here in the Yukon that we're not seeing any increase in traffic and that we have the right capacity here,” Pillai said.
Premiers also called for proper investment in the RCMP, per Pillai.
Pillai said a premiers' meeting has been scheduled for Dec. 15, with a number of governors invited to attend.
Ahead of Trump’s social media post about the potential tariffs, Pillai had a call with Alaska Gov. Mike Dunleavy, who Pillai described as Trump’s “incredibly close ally.” Pillai said the Nov. 25 call in part focused on how those jurisdictions can prepare for a renegotiation of the Canada-United States-Mexico Agreement, or CUSMA.
The Republican governor and the Liberal premier have signed formal deals to join forces on intergovernmental affairs like Arctic security and to upkeep the Alaska Highway.
Pillai said he amplified the premiers’ meeting invite to Dunleavy.
“It's important to make sure that many of these individuals are in a position to understand exactly how important, you know, the greatest trading relationship in the world should be treated and how we should continue on working together,” Pillai said.
Pillai said he has been vocal about Canada’s need to invest two per cent into the North Atlantic Treaty Organization, commonly known as NATO. He noted the premiers got together in July around this.
“It was very unique for the premiers to come together and ask the federal government to focus on that two-per-cent threshold and to do it at a speed that's appropriate, understanding that this new president wants to see this happen during his mandate over the next four years, not years from now,” Pillai said.
As reported in the Canadian Press, Canada committed last year to meet the NATO members’ pledge to spend at least two per cent of GDP on national defence and in July, Trudeau committed to hitting that target by 2032.
Pillai said premiers believe that NATO spending is important to Canada and the North.
“Borders and military spending will be key areas that the U.S. will be watching as they start making decisions about how we design our trading relationship,” Pillai said.
Trump’s inauguration is set for Jan. 20.
Contact Dana Hatherly at dana.hatherly@yukon-news.com
