Canada’s retaliatory tariffs on U.S. goods took effect just after midnight on Tuesday as Prime Minister Mark Carney increased economic pressure on his country’s biggest trading partner after negotiations collapsed last month, intensifying an 18-month-old trade war. The counter-tariffs cover $20 billion of U.S. goods, with duties ranging from 15% to 50% across products from steel and furniture to clothing and electronics.
The dollar-for-dollar retaliation marks an escalation in the dispute between the neighboring countries, and U.S. and Canadian officials have traded blame for scuttling a deal that seemed close to fruition two weeks ago. The rising tensions create uncertainty about the broader U.S.-Mexico-Canada free trade agreement, which is up for annual reviews after President Donald Trump declined to extend it for another decade. “What we are worried about is an escalatory spiral,” said Michael Harvey, executive director of the Canadian Agri-Food Trade Alliance and a member of Carney’s advisory committee on bilateral U.S. economic relations.
