In brief
A breakdown in trade talks between the United States and Canada has prompted President Trump to impose a 50% tariff on a range of Canadian products, triggering retaliation from Canadian Prime Minister Mark Carney. Carney vowed to match the tariffs dollar‑for‑dollar from September and accused the United States of imposing unfair restrictions on Canada’s ability to forge independent trade deals. The dispute follows a history of tense negotiations over U.S.–M. C. A. (USMCA), including a request for a 16‑year renewal that was rejected by Washington. Canadian leaders and provincial premiers have expressed concern that the new tariffs threaten jobs and the broader North American trade relationship. The volatile standoff signals significant economic risk for both nations and raises questions about the future of US‑Canada relations.
US President Donald Trump has said Canada wants "the benefits of being a state, without being one" after trade talks between the two countries collapsed late on Friday.
The breakdown of negotiations triggered new 50% US tariffs on a range of Canadian goods. Trump also said American farmers had been charged "massive amounts of tariffs" for years.
Canadian Prime Minister Mark Carney called the fresh tariffs a "miscalculation" designed to "hurt and divide us".
Carney confirmed he would match Trump's tariffs "dollar‑for‑dollar" from 8 September, including levies on steel, dairy, appliances and electronics, saying the US and Canada were now in a trade war.
Both countries were optimistic of a deal earlier in the week, but talks fell apart after both sides accused the other of making last‑minute changes.
"They asked too much and they offered too little," Carney said on Saturday. "You're at war when you get attacked. We got attacked."
Trump's latest comments echo his repeated references to making Canada the "51st state" of America since returning to office, sparking frustration among its leaders and residents.
The collapse of the trade talks upended a deeply integrated trading relationship with no clear path to resolution. "We cannot accept what they've offered and we will not give what they've asked," Carney said.
Trump told Fox News on Sunday that the Canadians were "foolish" to engage in a trade war with the US and think they will "actually win".
The new 50% US tariffs will apply to a range of Canadian goods, in addition to existing US tariffs on Canadian steel, aluminium, automobiles and lumber.
They are limited in scope, covering about $20 bn (£15 bn; C$28 bn) of imports from Canada, or about 5% in total, including wine, dairy, cement, clothing and hockey equipment.
The prime minister said Canada was retaliating "reluctantly" to protect its interests, with details of counter‑measures to be released in the coming days.
Leaders of other federal parties in Canada, including the Conservative opposition, voiced support for the prime minister, as have the leaders of some Canadian provinces.
In Canada, provincial premiers expressed concern that the new tariffs would reduce their economies to the "economic equivalent of the 51st state".
Canadian leaders urged both sides to resume talks amid economic uncertainty and potential job losses.
The dispute comes after more than a year of on‑again, off‑again trade talks, which intensified in recent weeks after a US‑imposed deadline to strike a deal or face further tariffs.
Both countries were also engaged in a mandatory review of the existing North American free trade agreement, USMCA, which underpins $1.6 trillion (£1.2 trillion) in annual trilateral trade.
Earlier this summer, Canada and Mexico formally requested for USMCA to be renewed for another 16 years. The US declined to renew it in its current form.
Asked how Friday's trade talk collapse would impact the North American free trade pact, Carney said it was "certainly not good news".
