US, Canada deepen trade war as sides fail to reach tariff deal
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- The Trump administration imposed 50% Section 338 tariffs on roughly US$20 billion in Canadian goods, effective just after midnight Saturday, after three days of talks between trade representatives in Washington ended without a deal.
- Mark Carney suspended trade negotiations, ordered Canada's negotiators back to Ottawa, and vowed to retaliate "dollar for dollar" on the new US tariffs.
- Carney publicly questioned "the reliability of any deal" with Washington, calling "last-minute changes in the US proposed terms" "unfair" and "uneconomic" in a pointed diplomatic rebuke.
- The new tariffs apply regardless of USMCA preferential treatment, overriding a trade shield that had protected most of Canadian industry from earlier US duties.
- The new measures stack on existing US duties on Canadian steel, lumber, and autos, with the article noting they could derail Canada's fragile economic recovery and complicate broader free-trade negotiations.
Why it matters: The US imposition of 50% tariffs on roughly $20 billion in Canadian goods — bypassing USMCA's preferential shield — directly threatens Canada's fragile economic recovery and complicates broader US-Canada free-trade negotiations, while Carney's public questioning of US deal reliability marks a sharp diplomatic escalation between two long-time allies.
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