Canadian Prime Minister Justin Trudeau announced that Canada will implement 25% tariffs on 155 billion Canadian dollars (approximately $107 billion USD) worth of U.S. goods, should the Trump administration enact their proposed tariffs on Tuesday.
This decision comes in direct response to President Donald Trump’s enforcement of 25% tariffs on Canadian imports, which are set to go into effect at 12:00 AM March 4.
The Trump administration imposed these tariffs citing national security concerns, specifically addressing issues related to illegal immigration and drug trafficking. The tariffs include a 25% duty on imports from Canada and Mexico, with Canadian energy products such as crude oil and natural gas facing a lower tariff of 10%.
President Trump emphasized that there was no room for negotiation to avoid these tariffs, expressing dissatisfaction with the progress made by Canada and Mexico in addressing these concerns.
In retaliation, Canada announced a two-phase tariff implementation:
- Phase One: A 25% tariff on 30 billion Canadian dollars worth of U.S. goods, effective Tuesday.
- Phase Two: An additional 25% tariff on 125 billion Canadian dollars worth of U.S. products, set to commence in 21 days.
Prime Minister Trudeau labeled the U.S. tariffs as “unjustified.” Trudeau went onto add, “Our tariffs will remain in place until the U.S. trade action is withdrawn, and should U.S. tariffs not cease, we are in active and ongoing discussions with provinces and territories to pursue several non-tariff measures.”
The initiation of these tariffs has raised concerns about a potential trade war between the neighboring countries. Economists warn that such measures could disrupt trade, increase consumer prices, and strain the economies of both nations. The U.S. stock market reacted negatively to the news, with significant declines observed across major indices.
Both Canada and the United States have expressed willingness to continue discussions to resolve the trade dispute. However, as of now, the tariffs remain in effect, and businesses in both countries are bracing for the economic impact. The situation continues to evolve, with further negotiations anticipated in the coming days and weeks.
