On Friday, Canadian Prime Minister Mark Carney announced the country’s decision to reduce certain retaliatory tariffs on U.S. goods while maintaining tariffs on automobiles, steel, and aluminum. This announcement followed a conversation between Carney and U.S. President Donald Trump, marking their first discussion since the two nations missed a self-imposed deadline to finalize a trade agreement.
Previously, Canada had imposed a 25% levy on approximately C$30 billion worth of U.S. goods, affecting various products, including orange juice and washing machines. This increase was a response to U.S. tariffs on Canada, which, as of August, had reached 35% for goods not compliant with the existing free trade agreement.
Carney stated that Canada plans to align with U.S. policies by eliminating tariffs on goods that comply with the U.S.-Mexico-Canada agreement (USMCA). This change is set to take effect on September 1 and aims to re-establish free trade for most goods exchanged between the two nations.
The U.S. government expressed support for Canada’s decision, describing it as “long overdue.” The U.S. looks forward to ongoing discussions about trade and national security with Canada. Trump indicated he and Carney would have further conversations soon.
Canada is one of the few countries to impose retaliatory measures against U.S. tariffs, alongside China. Public opinion polls indicate that a majority of Canadians support these counter-tariffs. Carney, elected in April, utilized a combative negotiating style, yet maintained that Canada could achieve a more favorable tariff deal with the U.S. than many other countries due to the provisions of the USMCA.
Looking ahead, Carney emphasized the importance of addressing ongoing trade issues in critical sectors such as autos, steel, aluminum, and lumber, especially with a review of the USMCA scheduled for next year. Economists have noted that U.S. tariffs on steel and aluminum pose significant challenges for Canada, which plays a vital role in supplying these materials to the U.S.
Source: https://www.bbc.com/news/articles/c5yk9dqlvygo?at_medium=RSS&at_campaign=rss