Canada Keeps Tariffs on U.S. Goods, Signals Softer Trade Stance
OTTAWA – Canada will maintain tariffs on U.S. autos, steel, and aluminum for now, Prime Minister Mark Carney announced Friday, while confirming that duties on other American goods covered under the USMCA trade pact will be lifted.
Speaking at a press conference in Ottawa, Carney said the United States had assured Canada it would not impose tariffs on goods compliant with the three-nation U.S.-Mexico-Canada Agreement — a move he welcomed as “a positive development.”
“In line with Canada’s commitment to USMCA, I am announcing that we will match the United States by removing all Canadian tariffs on U.S. goods specifically covered under the agreement,” Carney said. “Canada and the U.S. have now re-established free trade for the vast majority of our goods.”
The announcement boosted the Canadian dollar, which rose 0.5% to C$1.3837 per U.S. dollar by midday Friday.
Strained but Shifting Ties
Canada and the United States have been locked in talks for months over a broader economic and security arrangement, but progress has been slow. Ottawa is one of only two governments, alongside Beijing, that responded to Washington’s tariffs with retaliatory duties — a stance that irritated the Trump administration.
“We welcome this move by Canada, which is long overdue,” a White House official said, adding that Washington intends to continue pressing Ottawa on trade and national security issues.
Carney confirmed he had spoken with former U.S. President Donald Trump on Thursday and said Trump indicated that lifting tariffs would help restart negotiations.
Softer Approach Draws Criticism
Carney, who won office in April promising to stand firm against U.S. tariffs, has recently shifted to a more conciliatory approach. In June, he scrapped a proposed digital services tax that angered U.S. tech giants, and in July, he backed away from threats of new sanctions if no trade deal was reached by August 1.
Using an ice hockey analogy, Carney said it was time to ease tensions rather than continue an aggressive strategy. “Let’s be clear, we have the best deal of anyone in the world right now,” he told reporters.
But the move has sparked criticism at home. Conservative Party leader Pierre Poilievre accused Carney this week of being “too soft” on the United States, warning that the Liberals’ minority government could face backlash in Parliament.
Carney’s predecessor, Justin Trudeau, had taken a tougher line, imposing 25% tariffs on C$30 billion worth of U.S. goods in 2018 after Trump’s initial duties on Canadian steel and aluminum.
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