Canada-US Trade Talks

U.S. President Donald Trump announced Monday he will impose a 50% tariff on all Canadian automobiles, trucks, car parts and steel imports effective Jan. 1, 2027, escalating a trade dispute that flared after weekend negotiations between the two countries collapsed without agreement.

Trump wrote on Truth Social that Canada has been "ripping off" the United States for years and cited a $60 billion trade deficit he called unsustainable, adding that vehicles built in the U.S. would face no tariffs. The move comes after broad 50% U.S. tariffs already took effect Saturday on $20 billion worth of Canadian goods, including wine, dairy and hockey equipment, covering roughly 5% of Canada's annual exports to the U.S.

Canadian Prime Minister Mark Carney said retaliatory tariffs targeting U.S. steel, dairy, appliances and electronics will take effect Sept. 8, accusing Washington of using economic integration as a weapon.

Canadian and US negotiators face a Friday night deadline to finalise a trade agreement or risk a new wave of American tariffs on a broad range of Canadian goods, with talks now described as very close by Canadian Trade Minister Dominic LeBlanc ahead of a further meeting with US Trade Representative Jamieson Greer.

Manitoba Premier Wab Kinew urged Ottawa not to rush into concessions, calling Donald Trump untrustworthy and a "bad person" while warning Canada should fight rather than capitulate. Leaked details suggest the US would reduce steel and aluminium tariffs from 50% to 25% and auto tariffs from 25% to 15%, terms critics say are insufficient. Conservative leader Pierre Poilievre condemned any deal accepting unilateral tariffs, while an economist estimated 90,000 Canadian jobs could be lost under the new levies.

A key sticking point remains restrictions on US alcohol sales in eight of ten provinces, with Prime Minister Mark Carney pressing provincial leaders to lift bans. A Leger poll found 56% of Canadians favour a tough stance against Washington.