U.S. President Donald Trump. Image: C-SPAN video capture
U.S. President Donald Trump says a 35 per cent tariff will be applied to Canadian imports beginning August 1, reigniting trade tensions between the two countries.
But several media reports say the new tariff would not apply to goods that are compliant with the Canada-U.S.-Mexico Agreement, also known as CUSMA.
The announcement came in the form of an open letter to Prime Minister Mark Carney, where Trump cited concerns about Canada’s role in the U.S. fentanyl crisis and what he called “unfair trade practices.” He also warned that any tariff increase by Canada would lead to even higher U.S. tariffs in retaliation.
The U.S. president claimed the measures were tied to Canada’s alleged failure to prevent illegal drugs from entering the U.S., as well as long-standing frustrations over Canadian dairy protections and trade deficits.
He indicated that Canadian companies could avoid the tariffs by shifting production to the U.S., and left the door open to adjusting the tariffs based on future cooperation.
The Canadian government responded by saying it is still working to finalize a broader trade agreement with the U.S. and aims to reach a deal by August 1. That date reflects an update to the previously announced July 21 target set during last month’s G7 summit.
Negotiations between the two countries have faced several roadblocks in recent weeks, including U.S. concerns about Canada’s now-shelved digital services tax. Talks resumed after Canada signaled flexibility on that front, but key issues remain unresolved.
The new tariff comes just one day after Trump also announced a 50 per cent tariff on copper imports, another move expected to have a significant impact on Canadian exporters. The U.S. was Canada’s largest buyer of copper in 2023.
Canadian officials say negotiations are ongoing, with both sides working behind the scenes to avoid a broader trade disruption.
Meanwhile, Nova Scotia’s Premier says Trump has been a bully since day one.
Tim Houston says millions of workers and businesses are suffering on both side of the border because of this one man.
He says the silver lining is that attacking Canada made country work together, and his government will keep working to find other trade partners than the United States.
with files from Jacob Moore
