WASHINGTON: Hefty US tariffs on some Canadian products took effect on Saturday after days of negotiations that went down to the wire failed to produce an agreement.
Canadian Prime Minister Mark Carney vowed that Canada would match the US tariffs “dollar for dollar to protect our workers and businesses”, after officials said late on Friday that Washington and Ottawa had failed to reach a deal.
The lack of a final agreement means new 50% duties on about $20 billion of Canadian exports to the United States have come into force.
US Trade Representative Jamieson Greer told reporters on Friday that “tonight, Canada declined to finalise the trade deal under the terms agreed earlier this week”.
He said Washington had offered tariff reductions in sectors including steel and aluminium.
The announcement came after US President Donald Trump said the United States “should be able to have a deal with Canada”, citing his “good relationship” with Carney.
After hours of talks on Friday, however, Canada’s chief negotiator Dominic LeBlanc said officials still “have more work to do”.
LeBlanc and Greer had also held talks for about three hours on Thursday.
Tariff Dispute
Greer said the Trump administration had offered “significant tariff reductions on steel, aluminium, autos and lumber” in exchange for concessions from Canada.
He said Canada was also maintaining its “prolonged retaliation” against the United States.
Carney, however, said in a statement that “last-minute changes in the US proposed terms were unfair, uneconomic, and called into question the reliability of any deal”.
Dispute Over US Alcohol
Canada’s regional leaders had previously said Washington was particularly angered by Canada’s decision to remove US alcohol and wine from liquor stores.
The White House accused Canada of “discriminatory treatment” towards US alcohol, automobile and dairy products in introducing retaliatory duties.
The tariffs had originally been due to take effect on Wednesday, before Trump announced a last-minute three-day delay, citing major progress in negotiations.
Canadian negotiators had spent the week in Washington trying to resolve several outstanding issues.
Canada has been seeking relief from Trump’s tariffs on automobiles, steel and aluminium, which have weighed on the country’s economy, contributed to job losses and strained a previously close trading relationship.
Carney has repeatedly warned Canadians that relations with the United States have changed permanently, regardless of the outcome of any individual trade agreement.
He has called for Canada to diversify its economy and reduce its reliance on the United States, which currently accounts for about 70% of Canadian exports.
Beyond the immediate tariff dispute, Washington and Ottawa still need to negotiate revisions to the North American trade agreement, USMCA, which Trump declined to renew last month.
