Canada’s retaliatory US tariffs take effect as trade dispute grows

Canada’s retaliatory tariffs on billions of dollars’ worth of American imports have come into effect, escalating a trade fight that has been marked by intensifying tensions between US president Donald Trump and Canadian prime minister Mark Carney.

The tariffs took effect at 12.01am on Tuesday, and range from 15% to 50% and apply to products covering $20bn in imports from the US. The measures target sectors including steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics – industries that have been most affected by US tariffs.

The retaliatory tariffs come “as a result of the United States’ decision to impose a 50% tariff on $20bn of Canadian goods effective August 22”, the Canadian government said.

“Canada’s counter-measures do not apply to US goods that are in transit to Canada on the day on which they come into force,” it added.

Last month, Trump announced a new 50% tariff on cars and raw materials from Canada. He accused the country of “ripping off” the US “for years”. The US tariffs hit items such as hockey sticks and cement, affecting about 5.5% of Canadian exports to the US.

Since then, tensions between Canada and the US have intensified, with Carney last week urging the Trump administration to “start being serious” as the trade dispute has increasingly spilled into broader diplomatic tensions.

Trump and senior US officials have repeatedly criticized Canada and its leadership, while Trump has taken a series of symbolic digs at Canada including signing an executive order renaming Lake Ontario “Lake America” – which Canadians have rejected.

On Monday, Trump threatened to block sales of Canada’s Bombardier Aviation in the US, unless the Quebec-based plane maker moves manufacturing to the US.

“No more selling Bombardier in the United States!” Trump posted in all caps on his Truth Social platform, though he did not specify how he would achieve a sales halt.

Thousands of Bombardier aircraft currently operate in US airlines’ domestic fleets.

In a statement on Monday, the aerospace company touted its creation of “tens of thousands of jobs across the United States”, with “direct employment” in more than 20 states including Kansas, Texas, Arizona and California.

The company also noted that it spent more than $2.5bn annually with suppliers, and said its supply chain was “made up of approximately 2,800 American companies across 47 states”.

Negotiations between both sides broke down on 21 August after days of meetings in Washington, with Carney saying at the time that the Trump administration’s terms were ultimately unacceptable and that US negotiators had introduced restrictions on Canadian trade deals with other countries at the 11th hour.

US officials also made unacceptable “threats” to the French language and “Quebec culture”, he added, referencing the French-speaking province in eastern Canada, with Carney saying American negotiators viewed the measures as an “irritant”, while “in Quebec, these are rights”.

But Trump’s top trade official Jamieson Greer later noted the US government was aware that French language protections were sensitive and important.

“This is not something where we push hard, or condition, or red-line,” he told Canadian public broadcaster CBC last month.

Polls show Carney has broad support from Canadians, but it could disappear within months as the consequences of the trade war sink in, according to political analysts.

Just 20% of Americans approved of Trump’s tariffs on Canadian goods, a Reuters/Ipsos poll found.

Carney said last week his government was ready to sign a trade deal that benefited both countries, but US media reports say there are currently no ongoing negotiations between the two sides**.**

*With Agence France-Presse and Reuters*