Canada, US speed up trade talks after Trump announces 50% tariffs

Vancouver,UPDATED: Jul 22, 2026 02:00 IST

Canadian Prime Minister Mark Carney said on Tuesday that he and US President Donald Trump had agreed to intensify talks on a trade agreement between Canada, the United States and Mexico, a day after Trump announced 50 per cent tariffs on most Canadian goods. Speaking in Ottawa, Carney said the two sides had agreed to "deepen and speed up our negotiations over the next few weeks" and added that Canada would do what was needed to support jobs, workers and farmers.

Trump said Canada had unfairly discriminated against American autos, alcohol and dairy products. The new tariffs are due to take effect 30 days from Monday. While the move raised fears of fresh economic disruption and further strain in ties between the two countries, Canadian economists said the measures appeared narrower than first thought and could affect about 5 per cent of Canada’s exports to the United States.

Carney said, "Canada will do all that is necessary to support our jobs, our workers, our farmers and to make Canada stronger, more independent and more resilient." A US administration official who outlined the move on Monday said Canada was one of the few countries, apart from China, to retaliate against Trump’s earlier tariffs and "must be held accountable".

The new 50 per cent tariffs would exclude energy products, potash, fish and critical minerals, but would apply to goods that had earlier been protected from import taxes under the United States-Mexico-Canada Agreement, or USMCA. The 2020 trade pact was not renewed by the US, setting off a fresh round of talks that could continue until 2036. Carney said he planned to meet the country’s premiers virtually later on Tuesday.

British Columbia Premier David Eby strongly criticised Trump and the proposed tariffs. "This feels like an increasingly desperate and flailing approach to relationships with our country," he said. "There’s no question it will hurt families in British Columbia." Eby said Trump was wrong to think he could "bully us into whatever he wishes" and added, "I feel sorry for Americans. If you can’t be friends with Canada, then you almost certainly do not have friends anywhere in the world, and that is a very lonely place to be."

Saskatchewan Premier Scott Moe said the tariffs would hurt both countries. "When tariffs are applied it increases the cost for families and to do business on both sides of the border," he said. "These tariffs do nothing for making a more competitive North American economy." Ontario Premier Doug Ford said Canada should respond more forcefully. "We always seem to be on our back heels," he said. "We need to be on the offense. Not constantly on the defense with President Trump. We need to stand up to the bully, and we need to hit him tariff to tariff, all the way across the board."

Trump told reporters in the Oval Office on Tuesday that he loved the people of Canada, but claimed the country needed the United States to survive. "Canada’s been very, very tough on us over the years, for many years, and no other president’s done anything about it," he said. He also said the new tariffs were separate from his threats to impose additional levies over wildfire smoke that affected millions in the Great Lakes, Northeast and Mid-Atlantic regions of the US, repeating his claim that Canada was not managing its forests properly.

Economists in Canada said the tariff list covered a broad range of products, including honey, liquor, cement and hockey sticks. Robert Kavcic, a senior economist with the Bank of Montreal, said in a note to clients that the proposed tariffs would apply to about 28 billion Canadian dollars in annual exports to the US, or 19.8 billion US dollars. He said that was equal to 0.8 per cent of the Canadian economy. Kavcic said chemicals, plastics, electronics and industrial equipment appeared to be the biggest targets, followed by consumer goods and forestry products, with manufacturing machinery and agricultural and food products also included.

One US complaint has been that eight Canadian provinces have banned the sale of US alcohol at provincially run liquor stores. Carney said it was up to the provinces to decide whether to continue with the ban. Eby said people in his province backed the measure. "There is not a chance in hell that US alcohol is going back on the shelf in British Columbia," he said.

The developments left Canada and the US facing a fresh trade dispute, with new tariffs set to begin in 30 days even as Carney and Trump move to speed up negotiations. Canadian leaders said they would protect jobs and businesses, while provincial premiers warned of higher costs and deeper strain in relations.

With PTI Inputs

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