Canada has suspended trade negotiations with the United States and promised matching retaliation after Washington imposed 50% tariffs on about $20bn of Canadian goods following the collapse of talks between the two countries.
Prime Minister Mark Carney announced the decision shortly before the US tariff deadline expired on Friday night.
The new duties took effect at 12.01am Eastern Time on Saturday and cover goods that do not receive preferential treatment under the US-Mexico-Canada Agreement. The affected trade represents about 5% of Canadian exports to the United States.
Carney said Canada would respond “dollar for dollar” and ordered Canadian negotiators to return to Ottawa.
“Last-minute changes in the US proposed terms were unfair, uneconomic, and called into question the reliability of any deal,” Carney said in a statement.
He said negotiators had made progress but had failed to secure terms that met Canada’s objectives. Ottawa plans further measures to support workers and businesses affected by the tariffs.
US Trade Representative Jamieson Greer blamed Canada for the breakdown.
“Tonight, Canada declined to finalise the trade deal under the terms agreed earlier this week,” Greer said in a statement.
He accused Canada of introducing new demands and reversing earlier commitments. Greer described the failure to reach an agreement as a “missed opportunity”.
A senior Trump administration official said that Canada had sought further concessions on steel, aluminium, vehicles and softwood lumber. The official said no further negotiations were scheduled.
The two governments had spent three days in talks in Washington after US President Donald Trump extended an earlier tariff deadline.
According to Reuters, negotiators had discussed reductions in existing US duties on Canadian steel, aluminium and vehicles. The BBC reported that talks included proposals to cut steel and aluminium tariffs from 50% to 25% and vehicle tariffs from 25% to 15%.
Canada had also faced US demands concerning dairy access, retaliatory vehicle tariffs and restrictions imposed by Canadian provinces on sales of American alcohol.
The latest tariffs cover a range of Canadian products, including dairy products, clothing, cement, industrial machinery and hockey equipment among those affected.
Existing US tariffs already apply to Canadian steel, aluminium, vehicles and lumber.
The United States and Canada exchanged about $880bn in goods and services last year.
Ontario Premier Doug Ford backed Carney’s decision and called for a matching response to the US measures.
“The prime minister has my full support for a strong response – tariff for tariff, dollar for dollar,” Ford wrote on X.
Business groups on both sides of the border have warned that higher duties will raise costs and affect supply chains.
The US Chamber of Commerce said this week that higher tariffs would increase costs for US households and put jobs linked to North American trade at risk.
HT