US-Canada Trade War Reignites as Last-Minute Negotiations Collapse

Trade talks between Canada and the United States failed at the last minute on Friday night, reigniting the North American trade war as Ottawa vowed to match Washington’s tariffs.

Despite hopeful statements from both sides that a deal would be struck to avoid 50% US tariffs on a raft of Canadian goods locking in at the midnight deadline, the talks faltered. Canadian Prime Minister Mark Carney stated that the neighbors could not reach an agreement to "meet our objectives."

"As a result, this evening, I have decided to suspend trade negotiations with the US and have directed Canada’s negotiators to return to Ottawa," Carney said in a statement.

Now, 50% levies on $20 billion worth of Canadian goods have taken effect. "Canada will match those tariffs dollar for dollar to protect our workers and businesses," Carney added.

President Donald Trump and Carney, alongside top trade officials from both countries, had been in direct contact throughout the week after the president granted a three-day delay to the tariffs.

"Despite the U.S. 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," US Trade Representative Jamieson Greer said in a post on X.

Greer noted that the offer had included "significant tariff reductions on steel, aluminum, autos, and lumber" as well as "a historic economic and national security partnership." However, Carney argued that last-minute changes in the US terms "were unfair, uneconomic, and called into question the reliability of any deal."

The latest standoff stems from a trade relationship that has steadily deteriorated since Trump returned to office. The tariffs currently going into effect cover about $20 billion worth of goods imported from Canada, representing roughly 5% of the total value of goods imported to the US from its northern neighbor last year.

Carney stated that his government will introduce "additional measures to support Canadian workers and businesses," adding to the nearly $25 billion provided in support over the past 18 months, emphasizing that Ottawa would "not allow any nation to determine our future."