On 24/8, US President Donald Trump used the social media platform Truth Social to again criticize Canada for "taking advantage" of the US for many years. He cited Canada's high import tariffs on US agricultural products, which he claimed made life difficult for American farmers and contributed to a $60 billion trade deficit between the two nations.

The US President therefore announced that from 1/1/2027, import tariffs on all Canadian automobiles, trucks of all sizes, auto parts, aluminum, and steel will increase to 50%. However, goods produced in the US will be exempt from these tariffs.

He declared that the US "does not need Canada, but Canada needs the US," asserting that 95% of Canada's business is with the US. Canada is currently the US's second-largest trade partner, after Mexico.

Bilateral trade relations have been strained since Trump began his second term early last year. Recently, from 22/8, the US applied 50% import tariffs on $20 billion worth of Canadian goods, such as wine, wooden furniture, cement, clothing, and fishing rods. Last month, the US President signed off on applying these tariffs under Section 338 of the Tariff Act of 1930. This act allows tariffs of up to 50% on imports from a country that discriminates against US goods.

This $20 billion in goods represents about 5,2% of the total $383 billion in Canadian goods the US imported last year. These tariffs apply regardless of whether the goods are eligible for preferences under the US - Mexico - Canada Trade Agreement (USMCA).

These recent policies highlight Trump's tough stance on trade with Canada, further complicating ongoing negotiations regarding the future of the USMCA.

Canada also announced retaliatory tariffs on US goods from 8/9. Items subject to these tariffs include steel, dairy products, agricultural machinery, paper, and electronics.

By Ha Thu (via Reuters)