Canada has declared it will impose retaliatory tariffs totalling C$29.8 billion (approximately $21 billion USD) on a range of goods imported from the United States. The move comes in direct response to the Trump administration’s decision to proceed with tariffs on Canadian steel and aluminum, which took effect earlier this week.
The tariffs, set to be implemented imminently, target not only steel and aluminum products, but also a variety of other U.S. exports, including computers, sports equipment, and cast-iron products. According to the Canadian government, this dollar-for-dollar approach is a necessary countermeasure to what they deem unjustified tariffs imposed by the U.S.
The announcement was made jointly by Finance Minister Dominic LeBlanc, Foreign Affairs Minister Mélanie Joly, and Innovation, Science and Industry Minister François-Philippe Champagne, who together outlined the government’s strategy to defend Canadian economic interests.
Champagne stated that the U.S. administration is “once again creating disruption and disorder in a highly successful trading relationship, increasing costs for everyday goods for both Canadians and American families.”
This is not the first time Canada has responded to U.S. trade measures with tariffs. On March 4, Canada imposed 25% tariffs on $30 billion worth of U.S. imports in response to President Trump’s initial tariffs levied under the U.S. International Emergency Economic Powers Act (IEEPA). These earlier countermeasures remain in place, indicating Canada’s firm stance against what it views as unfair trade practices. Unless the U.S. addresses these tariffs, Canada may introduce more counter tariffs on U.S. imports on April 2.
The ongoing trade dispute occurs as Prime Minister Justin Trudeau prepares to hand over leadership to Mark Carney, who recently won the Liberal Party leadership. Carney has stated he will not be able to discuss trade issues with Trump until he is officially Prime Minister.
The Trump administration’s justification for the tariffs centres on claims that other nations are exploiting the U.S. through their trade policies, resulting in a significant trade deficit. However, this rationale has been widely criticised, with many economists warning that tariffs ultimately harm consumers by increasing prices and disrupting supply chains.
As tensions rise, there are concerns that the U.S. and Canada are entering into a full-blown trade war that could have economic consequences for both nations. Canada is the largest foreign supplier of both steel and aluminium to the U.S., and experts fear that Trump’s tariffs will ultimately increase costs for consumers.