OTTAWA, Aug 25 (Alliance News): Canada has announced retaliatory tariffs on around $20 billion worth of annual US imports, escalating a trade dispute with its longtime ally after Washington imposed new duties on Canadian goods.
The Canadian government said the counter-tariffs will take effect on September 8 and impose duties of 15%, 25% and 50% on around 700 products imported from the United States.
US President Donald Trump’s latest 50% tariffs on about $20 billion worth of Canadian imports came into effect on Saturday after trade negotiations between the two countries collapsed.
The tit-for-tat measures have further strained relations between the two neighbouring countries.
Canada’s Finance Minister François-Philippe Champagne said the government’s dollar-for-dollar counter-tariffs and a multibillion-dollar support package would protect workers, farmers, families and businesses.
Tariffs target wide range of US products
A Canadian government official said the highest 50% tariff would apply to steel, aluminum, furniture and clothing.
A 25% tariff would cover products including cheese, appliances and some seafood, while 15% tariffs would be imposed on electronics and tools.
The counter-tariffs will also cover prepared foods, perfumes and toiletries, plastics, lumber, wood pulp and paper products, carpets and other clothing items.
Industrial products targeted by the measures include iron and steel, aluminum, hand tools, machinery, electrical equipment, rail engines, motorcycles, furniture and gaming equipment.
The Canadian measures, calculated using 2024 trade figures, cover goods accounting for nearly 4.5% of Canada’s imports from the United States.
Canada seeks political and economic pressure
Industry Minister Melanie Joly said the counter-tariffs were primarily designed to protect Canadian businesses but would also apply political pressure in the United States ahead of the November 3 midterm elections.
She said Canada was targeting selected products and US states strategically to increase the political impact of the measures.
Trump’s latest tariffs on Canada are relatively narrow and affect roughly 5% of Canadian exports to the United States.
However, trade analysts warn that the duties could have severe effects on specific sectors already facing difficulties, including wood products and kitchen cabinet manufacturing.
The White House and the US Trade Representative did not immediately respond to requests for comment.
Canada announces C$7.5 billion support package
Alongside the retaliatory tariffs, Ottawa unveiled a C$7.5 billion support package for businesses and workers affected by the new trade measures.
The package includes assistance for small and medium-sized businesses, funding to help companies manage cash flow and support for workers at risk of losing employment because of the tariffs.
The Business Development Bank of Canada, a federal lender, will provide part of the financial support through interest-free loans ranging from C$2.5 million to C$5 million for affected businesses.
Joly said companies receiving the loans would not be required to begin repayments for 36 months, extending through the end of Trump’s current presidential term.
The latest measures mark a significant escalation in the trade dispute and could place additional pressure on businesses and consumers in both countries as Ottawa and Washington continue to negotiate their economic relationship.
