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Canada said it would match US tariffs “dollar for dollar” after the collapse of talks aimed at averting $20bn of American levies on Canadian imports, intensifying a trade war between Donald Trump’s administration and its northern neighbour.
Canada suspended trade talks with the US late on Friday due to “last-minute changes” that Ottawa deemed were “unfair, uneconomic, and called into question the reliability of any deal”, Prime Minister Mark Carney said in a statement shortly before midnight.
The failure of talks means the US will now impose a 50 per cent tariff on roughly $20bn of Canadian goods.
“Canada will match those tariffs dollar for dollar to protect our workers and businesses,” Carney said.
US trade representative Jamieson Greer told reporters the US had offered “significant tariff reductions” on steel, aluminium, vehicles and lumber but Canada had rejected the deal.
“This is a missed opportunity for Canada to partner with the US, which is the fastest growing economy in the G7,” Greer said, adding their offer was “the best treatment of any major exporter to our market”.
Greer said the talks were “not acrimonious” and there were no planned future meetings. “Canada was interested in additional concessions that the US wasn’t able to provide at this time,” he said.
Trump “will be provided with options to level out the playing field” regarding Canada’s retaliation, Greer said.
The collapse of talks on Friday followed weeks of contacts between US and Canadian officials over hundreds of billions of dollars’ worth of trade.
Earlier in the week, Trump had announced a three-day pause on the threatened $20bn of tariffs as part of a tentative deal with Canada. He told reporters earlier on Friday: “We should be able to have a deal with Canada.”
However, “progress has not been enough to meet our objectives for Canadians,” Carney said.
Ontario premier Doug Ford, who presides over one of the hardest-hit provinces, gave his full support to Carney’s “strong response.”
“As we fight to protect Canadian sovereignty and economic security, everything needs to be on the table. Ontario is ready to do its part,” he posted on X.
Candace Laing, president of the Canadian Chamber of Commerce, said this was another chapter in North America’s “self-defeating trade saga” and “a body blow to competitiveness”.
“Americans will see their costs go up, and Canadians will see customers, investment and small businesses disappear,” she said in a statement.
The Trump administration’s list of complaints was focused on lifting bans by Canadian provinces on US alcohol sales and a freeze on companies’ access to procurement tenders.
But Canada has sought relief on 50 per cent tariffs on its steel and aluminium sector and 25 per cent on vehicles as well as tariffs and anti-dumping levies on lumber, which over the past 18 months have forced factory closures and job losses.
The trade negotiations are proving a leadership test for Carney, whose 2025 election victory harnessed Canada’s anti-US sentiment with a defiant agenda to challenge Trump.
This week Canadian polling agency Leger reported 56 per cent of Canadians want the federal government to take a hard line with the US, compared with 31 per cent who favour flexibility if needed.
The trade clash with the US’s closest and second-biggest trading partner comes after the Trump administration in July opted against a long-term renewal of its 2020 trade deal with Canada and Mexico, considered one of the world’s largest trading pacts.
“There have been many constructive discussions in recent weeks and months [with Mexico],” Greer said on Friday night. “This is in contrast to Canada.”
