Canada suspends trade talks as 50% U.S. tariffs take effect

Canada's trade talks with the United States collapsed Friday night, just before tariffs on Canadian goods took effect.

Prime Minister Mark Carney suspended negotiations and directed Canada's trade team to return to Ottawa. "Last-minute changes in the U.S. proposed terms were unfair, uneconomic, and called into question the reliability of any deal," he said in a statement.

The two governments had shown positive signs earlier in the week, but a shift in U.S. terms in recent days proved insurmountable. U.S. Trade Representative Jamieson Greer countered that Canada introduced new demands and walked back commitments, upending the balance reached in prior days.

Carney announced that Canada will retaliate with dollar-for-dollar tariffs on U.S. steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics, effective September 8. The full product list is still being finalized.

Former Conservative Leader Erin O'Toole, a member of the Prime Minister's Advisory Committee on Canada–U.S. Economic Relations, acknowledged the complexity of the breakdown. Carney had worked for over a year with the U.S. in good faith, recognizing from the outset that America had changed and would weaponize economic integration against its allies.

Public support remains strong for Ottawa's stance. Carney had worked for over a year with the U.S. in good faith, recognizing from the outset that America had changed and would weaponize economic integration against its allies.

The tariffs represent a sharp escalation in the trade war. Canada had previously braced for this outcome; as HighOnCity reported in August, Alberta liquor businesses were already preparing for U.S. tariffs amid trade tensions.