Canada suspends US trade talks, matches 50 per cent tariffs on $28 billion of goods
Prime Minister Carney has directed negotiators back to Ottawa after last-minute changes to US terms, triggering a dollar-for-dollar tariff response on a significant portion of bilateral trade.
Canada has suspended trade negotiations with the United States, with Prime Minister Carney directing Canadian negotiators to return to Ottawa. The decision follows last-minute alterations to US proposed terms, which the Prime Minister described as unfair and uneconomic, raising doubts about the reliability of any final agreement.
Effective at midnight, the United States is set to impose a 50 per cent tariff on approximately $28 billion of Canadian goods. In response, the Canadian government will match these duties dollar for dollar to protect domestic workers and businesses. This figure represents an increase from the $20 billion cited in earlier reports, signalling a broader scope of protection for key export sectors.
The suspension comes after a period of intense diplomatic activity, including a three-day delay issued by President Trump on 21 August, which had cited major progress in the talks. However, the breakdown follows the US President’s earlier decision in August to decline to renew the North American Free Trade Agreement (USMCA), fundamentally altering the landscape of cross-border commerce.
Ottawa plans to introduce additional support measures for workers and businesses in the coming days. These new initiatives will build on nearly $25 billion in support already provided over the past 18 months, aiming to cushion the economic impact of the escalating trade tensions.
Prime Minister Carney stated that the government’s strategy has focused on building domestic strength and diversifying partnerships abroad. The Prime Minister noted that Canada is advancing nearly $500 billion in major infrastructure projects and is on track to double its market access to 1.5 billion consumers by the end of the year.
The statement highlighted that foreign direct investment in Canada is at its highest level in two decades, running at twice the rate of the nearest G7 competitor. With exports to non-US markets on track to double over the next decade, the government asserts that Canada is setting its own course rather than allowing any single nation to determine its economic future.
