US President Donald Trump has said Canada wants "the benefits of being a State, without being one" after trade talks between the two countries collapsed late on Friday. The collapse of the talks triggered new 50% US tariffs on a range of Canadian goods.
Tariffs War Escalates Between US and Canada
The US President's comments came after negotiations broke down, with Trump accusing Canada of making "massive amounts of Tariffs" for American farmers. Canadian Prime Minister Mark Carney called the fresh tariffs a "miscalculation" designed to "hurt and divide us".
Carney confirmed he would match Trump's tariffs "dollar-for-dollar" from 8 September, including levies on steel, dairy, appliances, and electronics. The US and Canada are now in a trade "war", he said.
Canada's Response to US Tariffs
Canadian Prime Minister Mark Carney said Canada was retaliating "reluctantly" to protect its interests. Details of the counter-measures will be released in the coming days, he said. Leaders of other federal parties in Canada, including the Conservative opposition, voiced support for the prime minister, as have the leaders of some Canadian provinces.
Tariffs have been a key component of Trump's trade policy, with the US President arguing they will boost American manufacturing and create jobs at home. Critics, however, say tariffs have raised prices for American consumers and have disrupted and damaged the global economy.
Disagreement Over Trade Deal
US trade representative Jamieson Greer told Fox News there were no plans to resume talks. He added that the US had been prepared to cut some of its tariffs on Canada as part of the ill-fated deal. Carney, however, said the US presented "unacceptable" terms that were too restrictive, including curbing Canada's ability to strike new trade deals with other countries.
Carney also rejected the assertion that Canada had made last-minute requests: "We clarified what was on offer and were continually disappointed by the answers."
Impact on USMCA
The collapse of the trade talks comes after more than a year of on-again, off-again trade talks, which intensified in recent weeks after a US-imposed deadline to strike a deal or face further tariffs. The two countries were also engaged in a mandatory review of an existing North American free trade agreement, known as USMCA, with Mexico.
The pact was signed by Trump during his first term to replace the 1994 North American Free Trade Agreement. It underpins $1.6tn in annual trilateral trade across Canada, the US, and Mexico. Asked how Friday's trade talk collapse would impact the North American free trade pact, Carney said it was "certainly not good news".
What's Next for US and Canada
The new 50% US tariffs will apply to a range of Canadian goods, in addition to existing US tariffs on Canadian steel, aluminium, automobiles, and lumber. The prime minister said Canada would continue to negotiate a new trade deal with the US, but the path forward is uncertain. The collapse of the trade talks upends a deeply integrated trading relationship, with no clear path to resolution.
Source: Joy Online
