Canadian Prime Minister Mark Carney has called US President Donald Trump's latest tariffs a "miscalculation" designed to "hurt and divide us". The new tariffs, which came into effect on Saturday, target a range of Canadian goods, including wine, dairy, cement, clothing, and hockey equipment.
Trade War Escalation
The collapse of trade talks between Canada and the US has led to a trade "war" between the two countries. Canadian Prime Minister Mark Carney confirmed on Saturday that Canada would match US tariffs "dollar-for-dollar" from 9 September, including levies on steel, dairy, appliances, and electronics. The new tariffs are limited in scope, covering about $20bn of Canadian imports, or about 5% in total.
Canadian leaders have rallied behind Prime Minister Carney, with leaders of other federal parties, including the Conservative opposition, voicing support for the prime minister. The leaders of some Canadian provinces have also backed Carney, with British Columbia Premier David Eby saying the US demand for restrictions on Canada's ability to have other trade deals "would reduce us to the economic equivalent of the 51st state". Quebec's Premier, Christine Fréchette, warned that jobs would likely be lost as a result of the new US tariffs.
Tariffs: A Tax on Imports
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. However, critics say tariffs have raised prices for American consumers and have disrupted and damaged the global economy. The new tariffs on Canadian goods are part of a broader trade dispute between the two countries, which have been engaged in on-again, off-again trade talks for over a year.
A Long-Standing Dispute
The collapse of 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, which underpins $1.6tn in annual trilateral trade across Canada, the US, and Mexico.
The impact of the trade talk collapse on the North American free trade pact is "certainly not good news", according to Canadian Prime Minister Mark Carney. As the situation unfolds, Canadian leaders are preparing to support impacted sectors, with Quebec's Premier, Christine Fréchette, vowing to introduce measures to support workers and businesses affected by the new US tariffs.
Source: Joy Online
