By Chibuzor Alli
Canada has suspended trade negotiations with the United States after talks broke down shortly before a Friday deadline, with Prime Minister Mark Carney warning that Ottawa would respond to new US tariffs “dollar for dollar”.
A fresh round of 50% US tariffs on a range of Canadian goods took effect at midnight on Saturday after the two countries failed to reach an agreement.
Mr Carney announced the suspension of negotiations shortly before the deadline, saying last-minute changes to the US proposals had made a deal unacceptable.
“Last-minute changes in the US proposed terms were unfair, uneconomic, and called into question the reliability of any deal.”
The Canadian prime minister said negotiators had made “important progress” during talks that began in July, but added that it was “not enough to meet our objectives for Canadians”.
“As a result, this evening, I have decided to suspend trade negotiations with the U.S. and have directed negotiators to return to Ottawa,” he said.
The breakdown came after President Donald Trump had temporarily paused the threatened tariffs earlier in the week, saying the two countries were close to reaching a trade agreement that was “very good” for both sides.
Trade negotiators had been working towards an agreement after Mr Trump threatened to impose a 50% levy on nearly $20bn (C$28bn) worth of Canadian imports by 19 August.
Following Mr Carney’s announcement, US Trade Representative Jamieson Greer accused Canada of walking away from an agreement that had been under discussion.
“Tonight, Canada declined to finalize the trade deal under the terms agreed earlier this week.
“Despite the US offer to Canada to receive the best treatment of any major exporter to our market, new demands and walk backs of other commitments by Canada have upended the careful balance reached in the past days,” the statement on X said.
The two sides had reportedly been discussing a reduction in US tariffs on Canadian steel and aluminium from 50% to 25%, while tariffs on Canadian automobiles would have fallen from 25% to 15%.
In return, Mr Carney had asked Canadian provinces to restore US alcohol products to store shelves.
The new 50% US tariffs will apply to a range of Canadian goods, including wine, dairy products, cement, clothing and hockey equipment.
They are in addition to tariffs already imposed by the US on Canadian steel and aluminium, automobiles and lumber.
Canada and the US have been engaged in on-and-off trade negotiations for more than a year, with Ottawa seeking the removal or reduction of tariffs affecting key sectors.
The US has also demanded concessions from Canada, including the removal of its remaining retaliatory tariffs on American automobiles and changes to Canadian dairy quotas to provide greater access for US cheese producers.
It has also called for the removal of restrictions on US alcohol sales imposed by most Canadian provinces last year in response to US tariffs.
Businesses and industry groups in both countries had called for an agreement, warning that further tariffs could increase costs and disrupt supply chains.
The US Chamber of Commerce said earlier in the week that “higher tariffs would damage both economies, drive up costs for US families, further disrupt critical supply chains, and risk the 13 million American jobs that depend on trade under the US-Mexico-Canada Trade Agreement”.
A poll by Canadian firm Abacus Data found that about 36% of Canadians supported retaliatory measures against US tariffs, while 30% preferred that the Carney government continue negotiations.
Mr Greer warned that the US would resist any retaliatory measures, saying it was “not going to tolerate” counter-tariffs.
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