Canadian cabinet minister Karina Gould on Saturday said she would take part in the contest to replace Prime Minister Justin Trudeau as leader of the ruling Liberal Party.

Chrystia Freeland, whose abrupt resignation as finance minister last month forced Justin Trudeau's exit as prime minister, said she is running to be the next leader of the Liberal Party and prime minister of Canada.

The race to replace Canadian Prime Minister Justin Trudeau is dominated by one name: Donald Trump. How to wrestle with the incoming president and his tariff threats has emerged as the defining question in the Liberal Party leadership contest.

Canadian officials are preparing retaliatory measures if the new U.S. administration imposes tariffs on Canadian imports.

Canada on Friday (Jan 17) issued a stark warning to the United States, promising that the nation would be hit with a "Trump tariffs tax" if US president-elect Donald Trump follows through on his plan to impose 25 per cent tariffs on Canadian imports.

Canada is prepared to respond to US trade tariffs if President Donald Trump follows through on his threats immediately after his inauguration, Reuters reports. If Trump proceeds with his threats, it could severely impact the economy,