The United States government of President Trump has within weeks broken a long history of trust between our nations.
This publication concerns itself with Canada’s space sector. And in the current political and economic environment, Canadians in the space sector should be bracing themselves for continued instability.
The only certainty is to expect the unexpected and plan accordingly.
Trump’s play for power and empire building
Trump’s tariff war has been chaotic in its implementation and he steadfastly remains committed to disrupting trade between our countries with unfounded allegations that Canada is taking advantage of the United States (U.S.).
Trump’s ultimate goal appears to be the weakening of Canada’s economy to the point of forcing concessions in a variety of areas he covets for the U.S. This of course includes critical minerals.
The auto sector received a reprieve of a month though that was to give the U.S. big three, Ford, General Motors and Stellantis, more time in relocating manufacturing to the U.S. Trump said, “they should get on it, start investing, start moving, shift production here to the U.S. of America, where they will pay no tariffs.” So where would that leave Canada’s auto sector?
Even if Trump were to walk back some of the current and proposed future tariffs, who could trust him and the U.S. government? The trust between Canada and the U.S. is shattered.
The U.S. mid-terms elections in the fall of 2026 could change some of the political dynamic, though Trump is challenging the pillars of American democracy where the Judiciary, Congress and the Executive Branch each have specific powers and duties. Trump is trying to take power away from Congress. How successful he will be is still to be determined but the billionaires are all lining up behind him.
And this Trump government clearly had a plan to execute once the keys to the White House were handed over. The changes being attempted could be in place even after Trump has left office.
I will note, though Trump certainly would not acknowledge it, that of the ~246 million eligible voters in the U.S. only 31.8% voted for him. That’s because only 63.9% of those eligible to vote actually voted. And of those who voted he received less than 50% of the vote at 49.8%. (All data from the Council on Foreign Relations)
Canada’s space sector and the U.S.
The Canadian Space Agency published it’s annual State of the Canadian Space Sector on September 24, 2024 which included useful data on Canada’s trade with the U.S.
The CSA stated that “The U.S. remained the main destination for Canadian space exports, totalling 59% of total exports. Revenues derived from exports to the U.S. expanded by 18%, or $177M, from $1.01B in 2021 to $1.18B in 2022.”
This is a little less than triple Canada’ second largest export destination, Europe, with exports of $428.9 million in 2022.
As one might expect, the vast majority of revenues is in the Downstream areas with Satellite Communication leading the way adding up to $3.26 billion. This divided into Services ($2.22B), Satellite Operations ($758M), and Value-Added Products and Applications ($286).
In the Upstream areas, Satellite Communication still leads the way at $528 million but revenues are much smaller. The revenues are divided into Research, Engineering and Consulting Services ($88.5M), Space Systems Manufacturing (299.6M), and Ground Systems Manufacturing (130M).
What’s unclear at this time, and we’re looking into, is whether the blanket 25% tariffs are actually being imposed yet on all of Canada’s space exports to the U.S.
What is clear is that the United States is no longer a reliable partner.
Canada’ space sector must now double down its efforts to expand its current export markets while looking for new markets. Canada already has a relationship with the European Space Agency as a cooperating member state, perhaps it’s time to look into whether the relationship could be expanded. There is a free-trade agreement with the European Union (CETA) but it never amounted to much for Canada’s space sector and in 2022 Canada elected to not to renew the CETA trade agreement space related section.
More to follow.
Late breaking news (3:09 PM ET): In another chaotic turn, President Trump has suspended tariffs targeting Canada until April 2.
