Canada is set to announce its response on Tuesday to new US tariffs imposed by President Donald Trump, as tensions between the two neighbours escalate into a broader trade dispute.
The Canadian government said ministers of finance, industry and labour, alongside other officials, would hold a press conference in Ottawa to outline measures aimed at protecting Canadian workers and businesses.
The move follows the failure of Canada and the US to reach a deal last Friday to avert new 50% US tariffs on selected Canadian goods. The duties took effect on Saturday, while Canadian Prime Minister Mark Carney has announced retaliatory tariffs from Sept 8 targeting US steel and dairy products, as well as agricultural equipment, paper and electronics.
Trump has also threatened to double tariffs on Canadian autos from next year to 50%. The current US tariff on Canadian autos is 25% on non-US content, while imported steel generally faces a 50% duty.
Carney said Canada had rejected what he described as an unacceptable deal after negotiations raised concerns about the impact on major domestic industries, including automotive, steel and aluminium.
Canada relies heavily on the US market, with exports to its southern neighbour accounting for about 70% of its total exports. Canada is also the US’ second-largest goods trading partner this year after Mexico.
The latest US duties affect about 5.5% of Canadian goods entering the US, worth around US$20 billion, including products such as hockey sticks and cement.
The dispute comes as Washington and Ottawa also prepare to negotiate revisions to the US-Mexico-Canada free trade agreement. Trump has repeatedly criticised Canada over trade and has threatened to impose further tariffs, while Carney has pledged to diversify Canada’s trade and strengthen domestic industries.
