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Photo by HYUNGCHEOL PARK/PostmediaCanada’s top economists told the country’s finance minister that the damage from the spiraling trade war with the U.S. should be manageable, potentially bolstering Prime Minister Mark Carney’s case for walking away from the talks.Subscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Subscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountorFinance Minister Francois-Philippe Champagne called a private meeting with chief economists — including some representing the country’s largest banks — in Toronto to discuss the outlook after trade talks collapsed with the U.S., which is by far the largest buyer of Canadian exports.Some economists have pared their growth forecasts and warned that small- and medium-sized businesses are likely to feel the brunt of the new import taxes the U.S. has placed on hundreds of items from Canada. “A 50 per cent tariff could well represent an insurmountable barrier for their ability to reach the U.S. market,” economists at Canadian Imperial Bank of Commerce wrote.SUBSCRIBER EXCLUSIVE: FP West: Energy Insider brings you behind the oilpatch’s closed doors with exclusive insights from insiders every Wednesday morning.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of FP West: Energy Insider will soon be in your inbox.We encountered an issue signing you up. Please try againBut during the meeting with Champagne, there was little discussion of recession risk, according to some participants who spoke on condition of anonymity to talk about what transpired.Instead, there was broad agreement that Canada’s economy is strong enough to absorb U.S. President Donald Trump’s tariff salvos. There will be damage, but it’s likely to be mostly concentrated in sectors hit by the tariffs, some economists told the minister.On Saturday the U.S. added 50 per cent tariffs to about US$20 billion worth of Canadian imports, including electrical equipment, plastics and plywood. That’s in addition to earlier US taxes on steel, autos, aluminum, lumber and other products.Carney’s government responded in kind, adding new duties on a wide range of US items that partially mirrored Trump’s tariffs, starting Sept. 8. Canada doubled its existing counter-tariffs on some U.S. steel and aluminum products to 50 per cent.Wednesday’s meeting “reinforced that Canada’s economic fundamentals remain strong and the economy has proven resilient despite significant headwinds,” said Audrey Milette, a spokesperson for Champagne.One caveat is that the trade war may still escalate. Trump threatened this week to put 50 per cent tariffs on Canadian vehicles and to hit auto parts on Jan. 1 — measures that would create massive disruption in that sector, if he follows through.Officials in Ottawa believe the trade impasse may last beyond the U.S. midterm elections in November, and Carney himself has said his government is prepared to support tariff-impacted industries for years if necessary. It’s already announced a multibillion-dollar package of loans and benefits to help firms and workers affected by the trade war.Public opinion appears to be behind Carney, as a poll taken on the weekend showed three in four Canadians endorsed his decision to walk away from negotiations.Statistics Canada is set to release second-quarter gross domestic product data Friday in Ottawa. Economists surveyed by Bloomberg expect the economy expanded at a 3.4 per cent annualized pace, the fastest since the end of 2023 and a rebound from nearly a year of weakness.With assistance from Brian Platt Join the Conversation This website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.