Canada has vowed to match new United States tariffs “dollar for dollar” after last-minute negotiations between the neighbouring countries collapsed, escalating an already bitter trade dispute.
According to the BBC, Canadian Prime Minister Mark Carney suspended negotiations with Washington shortly before the deadline and ordered his country’s negotiators back to Ottawa after accusing the US of making unacceptable last-minute changes to the proposed agreement.
Carney rejects last-minute US terms
“Last-minute changes in the US proposed terms were unfair, uneconomic, and called into question the reliability of any deal,” Carney said.
The prime minister acknowledged that negotiators had made important progress but said the proposed agreement ultimately failed to meet Canada’s objectives.
“As a result, this evening, I have decided to suspend trade negotiations with the U.S. and have directed negotiators to return to Ottawa,” he said.
Carney subsequently announced that Canada would retaliate against the tariffs rather than accept Washington’s latest measures.
“Canada will match those tariffs dollar for dollar to protect our workers and businesses,” he said.
US tariffs hit Canadian goods
The breakdown allowed a 50% US tariff on approximately $20 billion worth of Canadian imports to take effect early Saturday.
Products affected include wine, dairy products, cement, clothing and hockey equipment.
The new measures are separate from existing US tariffs on Canadian steel, aluminium, vehicles and lumber.
US President Donald Trump had initially planned to introduce the tariffs earlier in the week but granted a three-day extension as officials expressed optimism that an agreement was close.
Trump had said the two countries were approaching a deal that would benefit both sides, but negotiations eventually unravelled shortly before the extended deadline.
Washington blames Canada for collapse
US Trade Representative Jamieson Greer presented a different account of why negotiations failed, accusing Canada of backing away from previously agreed terms.
“Tonight, Canada declined to finalize the trade deal under the terms agreed earlier this week,” Greer said.
He claimed Washington had offered Canada favourable treatment compared with other major exporters but accused Ottawa of introducing new demands and reversing earlier commitments.
Canada had been seeking reductions in US tariffs affecting major industries, including steel, aluminium, automobiles and lumber.
Negotiators reportedly discussed reducing tariffs on Canadian steel and aluminium from 50% to 25%, while duties on automobiles could have fallen from 25% to 15%.
Canada was also under pressure to make concessions over dairy access, retaliatory automobile tariffs and restrictions affecting the sale of American alcohol.
Trade tensions deepen
The latest confrontation represents another deterioration in relations between two countries that have traditionally enjoyed one of the world’s closest economic partnerships.
Canada sends a significant proportion of its exports to the United States, while businesses on both sides depend heavily on cross-border supply chains.
Business groups have warned that escalating tariffs could raise prices, disrupt production and hurt workers and consumers in both countries.
The dispute could also complicate discussions over the future of the United States-Mexico-Canada Agreement, which governs much of North American trade.
With negotiations now suspended and both governments preparing tariffs against each other, there is no immediate indication of when formal talks will resume.
