The United States has imposed new tariffs on a variety of products, including C$12.6 billion on steel and $3 billion on aluminium, citing national security concerns. These tariffs, which also affect tools, computer equipment, water heaters, sports equipment, and cast-iron products, came into effect on Wednesday. This marks the end of exemptions previously granted to several countries, including Canada. In response, Canada has announced C$29.8 billion ($20.7 billion) in reciprocal tariffs on US imports, highlighting the escalating trade tensions between the two nations.
US President Donald Trump has justified these tariffs by claiming they are necessary to protect US national security and to stimulate domestic production, which he argues has been weakened by foreign competition. Mark Carney, Canada's Prime Minister-designate, has expressed readiness to negotiate a renewed trade deal with President Trump, provided there is "respect for Canadian sovereignty." Carney condemned the latest US tariffs as "unjustified" and emphasized Canada's stance on maintaining sovereignty in trade negotiations.
The Canadian government announced its own tariffs on US goods, including steel and aluminium, with additional measures set to take effect at 00:01 EST (04:01 GMT) on Thursday. Further complicating the situation, the US president implemented a blanket 25% tariff on goods from Canada and Mexico, citing concerns over drugs and migrants crossing the US border.
The impact of these tariffs is significant for Canada, which is the largest foreign supplier of steel and aluminium to the United States. The country's central bank has responded by reducing interest rates to 2.75% from 3% to prepare the economy for potential disruption. Meanwhile, Ontario Premier Doug Ford and federal representatives are scheduled to meet US Commerce Secretary Howard Lutnick on Thursday to discuss the implications of the 25% tariffs imposed by the US.
Mark Carney, who was elected as the leader of the governing Liberal Party on Sunday, is poised to become Canada's next prime minister, succeeding Justin Trudeau. Carney's leadership will be pivotal as Canada navigates this challenging trade environment. Canadian Finance Minister Dominic Leblanc stated at a news conference that Canada remains focused on de-escalating the situation while protecting its economic interests.