Trade negotiations between the United States and Canada collapsed overnight, prompting Washington to impose 50% tariffs on selected Canadian imports worth approximately $20 billion. The measures, enacted under Section 338 of U.S. trade law, take effect just after midnight local time on Saturday, a senior U.S. administration official confirmed.
Canadian Prime Minister Mark Carney suspended further talks and announced reciprocal countermeasures of equivalent financial magnitude. In a statement issued late Friday, Carney instructed negotiators to return to Ottawa, calling the last-minute U.S. demands both unfair and economically unviable. The new duties apply irrespective of whether the targeted goods fall under the USMCA free trade framework, which has historically shielded Canadian exports from U.S. tariffs.
While the measures affect a comparatively small segment of Canada’s total export basket, they compound existing U.S. tariffs on steel, lumber and automobiles. Analysts warn the combined levies could dampen Canada’s fragile economic rebound and complicate future efforts to negotiate a broader free trade pact. The dispute marks a sharp escalation in bilateral trade tensions, raising concerns over broader supply chain disruptions and retaliatory cycles.
