The government is preparing for the possibility that the incoming U.S. administration will impose high tariffs on Canadian goods, setting the close allies up for a showdown.

Canada will have a "robust" response if Donald Trump imposes tariffs on its goods, but Canadian leaders are split over energy as a bargaining chip.

Canada's outgoing Prime Minister Justin Trudeau said on Wednesday that “nothing is off the table” when it comes to responding to proposed tariffs by President-elect Donald Trump, but that no single region of the country should bear the full brunt of that response.