Canada suspends trade talks, new 50% U.S. tariffs take effect

Canada is now facing 50 per cent U.S. tariffs after Prime Minister Mark Carney sent his negotiating team home late Friday evening.

Carney cited last-minute changes to the proposed terms by the Americans as the reason for walking away, saying they were “unfair, uneconomic, and called into question the reliability of any deal.”

Due to the collapse of the deal, new 50 per cent tariffs will now hit roughly $28 billion worth of Canadian exports to the U.S. These tariffs took effect at 12:01 a.m. Aug. 22.

But the prime minister said Canada would retaliate with equal measures – hitting the U.S. with “dollar-for-dollar” tariffs.

Announced Saturday afternoon, Carney says those retaliatory tariffs will hit the U.S. next month on Sept. 8. He added that Canada was attacked when questioned about the escalating trade war.

“They asked too much and offered too little. We cannot accept what they have offered, and we will not give what they have asked,” Carney said.

The Canadian dollar-for-dollar tariffs will target American sectors such as steel, dairy, appliances, agricultural equipment, pulp and paper and electronics. More details on retaliatory tariffs are expected in the coming days.

“We take this step reluctantly,” Carney said. He added that some measures taken will raise costs and reduce choices for Canadians.

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Carney’s statement released just before midnight reads, in part, “We have recognised from the beginning that America has changed, and that we will not return to our old relationship. Our government understood, before many, that America is altering all its trade relationships. Putting tariffs on its closest allies and charging for access to its vast market.”

“We have worked in that context. To strike a fair deal that would provide the best access to the U.S. market and greater certainty to Canadian businesses and workers. Throughout, our goal has been to secure the best deal for Canadians, never a deal at any price or on any deadline.”

Canada-U.S. Trade Minister Dominic LeBlanc and chief negotiator Janice Charette have been meeting with American officials in Washington for the last two weeks trying to strike a deal. This included several hours of talks with U.S. Trade Representative Jamieson Greer.

Greer commented on the decision, saying Canada had “declined” to finalize a tentative agreement. He continued to lay the blame entirely on Canada.

“Despite the U.S. offer to Canada to receive the best treatment of any major exporter to our market, new demands and walk-backs of other commitments by Canada have upended the careful balance reached in the past days,” said Greer. “In addition, Canada is continuing to maintain its prolonged retaliation against the United States, including, among other things, flat-out prohibitions on certain American goods and services.”

Carney said the federal government will, “in the coming days,” announce support for Canadian workers affected by the new U.S. tariffs.

With files from The Canadian Press

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