Canada is stepping back in its trade war with the U.S. as Prime Minister Mark Carney announced on Friday that the country will drop some of its hefty retaliatory tariffs on U.S. goods. This decision follows his recent phone call with President Donald Trump.
Previously, Canada imposed a 25% tariff on around C$30 billion in U.S. products, including items like orange juice and washing machines. However, Carney stated that tariffs on goods compliant with the US-Mexico-Canada free trade agreement (USMCA) will be lifted, helping to "re-establish free trade" between the nations.
This change kicks in on September 1 and is welcomed by the White House, which described it as "long overdue." Although Canada is known for its strong stance against U.S. tariffs, polling indicates that many Canadians support the retaliatory measures.
Carney emphasized that this move doesn't signify a softening of Canada's position, but rather a more favorable tariff deal thanks to the USMCA. The country boasts a tariff rate of about 5.6% compared to the 16% average for others.
The Canadian government is now focusing on accelerating negotiations around key sectors such as autos, steel, and aluminum, especially with a review of the USMCA coming up next year. Meanwhile, U.S. tariffs remain steep, particularly at 50% for imports of steel and aluminum from most countries except for the U.K. This adjustment in trade dynamics highlights the shifting landscape as both countries work towards resolution.
Previously, Canada imposed a 25% tariff on around C$30 billion in U.S. products, including items like orange juice and washing machines. However, Carney stated that tariffs on goods compliant with the US-Mexico-Canada free trade agreement (USMCA) will be lifted, helping to "re-establish free trade" between the nations.
This change kicks in on September 1 and is welcomed by the White House, which described it as "long overdue." Although Canada is known for its strong stance against U.S. tariffs, polling indicates that many Canadians support the retaliatory measures.
Carney emphasized that this move doesn't signify a softening of Canada's position, but rather a more favorable tariff deal thanks to the USMCA. The country boasts a tariff rate of about 5.6% compared to the 16% average for others.
The Canadian government is now focusing on accelerating negotiations around key sectors such as autos, steel, and aluminum, especially with a review of the USMCA coming up next year. Meanwhile, U.S. tariffs remain steep, particularly at 50% for imports of steel and aluminum from most countries except for the U.K. This adjustment in trade dynamics highlights the shifting landscape as both countries work towards resolution.
