Canada pledges dollar-for-dollar tariffs after US trade talks collapse

Canadian Prime Minister Mark Carney has pledged to match US tariffs "dollar for dollar" after trade talks between Ottawa and Washington broke down.

Hefty new 50% duties impacting around $20 billion worth of Canadian goods took effect on Saturday after Carney said "last-minute changes in the U.S. proposed terms were unfair, uneconomic, and called into question the reliability of any deal."

"Canada will match those tariffs dollar for dollar to protect our workers and businesses," Carney added in a statement. "In recent weeks, we made important progress toward improving Canada’s position as having the best deal in the world with the U.S. However, that progress has not been enough to meet our objectives for Canadians."

US Trade Representative Jamieson Greer said on Friday that "tonight, Canada declined to finalise the trade deal under the terms agreed earlier this week." He added that the Trump administration had tabled "significant tariff reductions on steel, aluminium, autos and lumber" in exchange for Canadian concessions.

The announcement came despite US President Donald Trump having said the US "should be able to have a deal with Canada" as he touted his "good relationship" with Carney.

The tariffs had been due to come into force on Wednesday, but Trump postponed as talks appeared to progress. Washington has accused Canada of "discriminatory treatment" against US alcohol, automobile, and dairy products as part of its reasoning for the levies.

Ottawa has been pushing for relief from Trump's tariffs on steel and aluminium and autos, which have weighed heavily on Canada's economy, led to job losses, and strained the countries' trade relationship.

Ryan Majerus, a former US commerce official, told AFP: "If Canada has agreed to also impose retaliatory tariffs, that will make deescalating this a lot harder."