Canada has begun imposing fresh retaliatory tariffs on American goods as tensions between Ottawa and Washington deepen, with no immediate sign of a breakthrough in stalled trade negotiations.
The new measures cover almost C$28 billion ($20 billion) worth of products imported from the United States, with tariffs reaching as high as 50 per cent on some items.
The affected products include steel, furniture and cotton T-shirts, among other American goods.
Fresh fish and lobster were initially included in the tariff list but were later removed following pressure from Canada’s seafood industry. The decision highlights the difficulties facing Ottawa as it attempts to respond to US trade measures without creating additional problems for Canadian businesses and consumers.
Trade Talks Remain Stalled
Canadian and US officials have both indicated that they remain interested in reaching an agreement, but negotiations have not resumed since talks broke down in late August.
Canadian Prime Minister Mark Carney said Ottawa remained prepared to negotiate a lasting agreement that would serve the interests of both countries.
“We’re ready to sit down and strike that deal when the Americans are ready,” Carney said.
However, US Trade Representative Jamieson Greer offered a different assessment, arguing that the next move should come from Canada.
Greer said Washington had presented what it considered its best offer but that Canada rejected it. He also warned that the United States could respond to Canada’s retaliatory measures with additional restrictions, including possible bans on selected Canadian products.
Trump Escalates Pressure
US President Donald Trump has continued to pressure Canada, including a threat to halt US business with Canadian aircraft manufacturer Bombardier unless the company moves manufacturing operations into the United States.
Bombardier is a major contributor to Canada’s economy. A report commissioned by the company and prepared by PwC estimated that it contributed more than C$7 billion to Canada’s annual GDP in 2024.
Trump has also criticised Canada’s currency relationship with the US and posted material on social media portraying Canada, Mexico and Greenland under the US flag.
Businesses Brace for Disruption
The latest measures come as businesses on both sides of the border attempt to assess the consequences of the escalating dispute.
Canada and the United States have one of the world’s largest bilateral trading relationships, with trade valued at almost $900 billion in 2025.
The scale of that relationship means prolonged tariffs could affect manufacturers, exporters, retailers and consumers in both countries.
For Canada, the immediate challenge will be maintaining pressure on Washington while protecting domestic industries from the unintended consequences of its own retaliatory measures.
With negotiations still frozen, businesses are now preparing for the possibility that the trade confrontation could continue for an extended period.
