Dorothy

Canada had sought concessions on tariffs on steel, aluminum, autos and lumber. “Tonight, Canada declined to finalize the trade deal under the terms agreed earlier this week. Despite the U.S. offer to Canada to receive the best treatment of any major exporter to our market, new demands and walk-backs of other commitments by Canada have upended the careful balance reached in the past days,” U.S. Trade Representative Jamieson Greer said in a statement read to reporters shortly before midnight.

U.S. Trade Representative Jamieson Greer told reporters in a White House briefing on Friday night that "Canada declined to finalize the trade deal under the terms agreed earlier this week."

"Tonight, Canada declined to finalize the trade deal under the terms agreed earlier this week," the United States Trade Representative wrote on X early Saturday morning.

“Tonight, Canada declined to finalize the trade deal under the terms agreed earlier this week,” Greer said in a statement.

Details leaked to several media outlets suggest the US will agree to reduce tariffs on Canadian steel and aluminium from 50% to 25%, and tariffs on Canadian automobiles from 25% to 15%.

Carney blamed Washington for the breakdown, saying “last-minute changes in the U.S. proposed terms were unfair, uneconomic, and called into question the reliability of any deal.” He said he had suspended negotiations and directed Canada’s negotiating team to return to Ottawa.

Canadian Prime Minister Mark Carney said in a statement released on Friday that despite working toward a deal, "that progress has not been enough to meet our objectives for Canadians," saying that "last-minute changes in the U.S. proposed terms were unfair, uneconomic, and called into question the reliability of any deal."

Carney, the former governor of both the Bank of England and the Bank of Canada, as well as the former chairman of Brookfield Asset Management, which has an estimated $23 billion in China-linked assets (as of 2021), blamed Washington for the breakdown in trade negotiations. He pledged to match the new US tariffs "dollar for dollar" to protect Canadian workers and businesses.

Published One of Canada's provincial leaders has criticised a prospective trade deal with the US and pushed his country to hold out for favourable terms, showing Prime Minister Mark Carney faces a tough battle in getting buy-in on the agreement as the hours tick down to a US-set deadline

“Canada will match those tariffs dollar for dollar to protect our workers and businesses,” Prime Minister Mark Carney said in a statement. The retaliation escalates the trade conflict and calls into question the future of a North American trade agreement covering the United States, Canada and Mexico that is crucial to industry in all three countries.

Canada's Prime Minister Mark Carney said he had suspended trade negotiations and Canada would retaliate dollar for dollar on the new tariffs.

Canadian Prime Minister Mark Carney announced on Saturday that retaliatory tariffs on U.S. goods will take effect on Sept. 8. [OtterAI]

The tariffs were initially supposed to kick in at 12:01 a.m. Wednesday. Trump extended the deadline for three days to allow talks to continue, but the countries could not reach an agreement in time.

The two countries had good reasons to find a compromise. Nearly 72% of Canada’s goods exports last year went to the United States. The Trump administration might be wary of imposing new tariffs — paid by U.S. importers who try to pass along the cost to consumers via higher prices — before the November’s midterm elections. American voters are already frustrated with the high cost of living.

“Canada likely wanted further sector-specific relief than the U.S. was willing to offer, or Canada’s concessions did not go far enough,” said Ryan Majerus, a partner at King & Spalding and a former U.S. trade official. “Either way, I think both sides will be under immense pressure in the coming days to still find an off-ramp. But if Canada has agreed to also impose tariffs, the off-ramp may be even harder to find.”

Candace Laing, president and CEO of the Canadian Chamber of Commerce, called the tariffs “a body blow to North American competitiveness,” warning they would raise costs for Americans while threatening Canadian customers, investment and small businesses.

So Trump has looked for other legal authority to justify tariffs. To punish Canada, he reached back to the Great Depression, invoking Section 338 of the Tariff Act of 1930 to threaten 50% tariffs on products that account for about 5% of Canadian exports to the United States.

So Trump has looked for other legal authority to justify tariffs. To hit Canada, he reached back to the Great Depression, invoking Section 338 of the Tariff Act of 1930 to threaten 50% tariffs on products that account for about 5% of Canadian exports to the United States.

“Canada told the Americans in advance that if these tariffs landed, it would stop negotiating and retaliate,” said Barry Appleton, senior fellow at the Center for International Law at New York Law School. ”The American trade representative said publicly he would not tolerate retaliation. Both sides have now committed themselves in public, which is how escalation stops being a choice.”

Premier Christine Fréchette also pushed back against quickly restoring U.S. alcohol to provincial stores, saying Quebec alone would decide whether American products return to shelves at the SAQ, the Quebec government corporation that controls most retail sales of wine and spirits in the province.

In addition to restoring the sale of American booze, Canada is said to be considering allowing American dairy producers greater access to its market.

Canada-US Trade Minister Dominic LeBlanc is set to meet with his counterpart, US Trade Representative Jamieson Greer, again on Friday morning.