August 22, 2025
Prime Minister Mark Carney announced Friday that Canada is removing retaliatory tariffs on some U.S. products in a bid to reset trade discussions with the White House that have stalled in recent weeks.
He said Ottawa plans to remove tariffs on U.S. goods that comply with North American free-trade deal rules, mirroring a key carveout U.S. President Donald Trump made for Canadian goods.
Mr. Carney said Canada will retain its tariffs on steel, aluminum and autos as it works “intensively” with the U.S. to resolve those issues. He said Canada’s focus will be on strategic sectors and the future renegotiation of CUSMA.
He said that following his conversation this week with Mr. Trump, Canada and the United States will intensify our discussions “to address current trade challenges in those strategic sectors” and to seize opportunities in trade, investment and security.
Mr. Carney announced the change Friday at a news conference on Parliament Hill.
He portrayed it as a win for Canada that the U.S. recently reaffirmed Canadian exports to the U.S. that are compliant with the existing North American free-trade rules will not be subject to Mr. Trump’s blanket tariffs.
“Let’s be absolutely clear, Canada currently has the best trade deal with the United States, and while it’s different from what we had before, it is still better than that of any other country,” he said.
The Prime Minister said talks will continue on addressing outstanding trade issues in the trade pact, referring to the Canada-United States-Mexico Agreement.
“In this context and consistent with Canada’s commitment to CUSMA, I’m announcing today that the Canadian government will now match – we will now match – the United States, by removing all of Canada’s tariffs on US goods, specifically covered under CUSMA,” he said.
Mr. Carney and Mr. Trump spoke by phone on Thursday, their first direct communication in months and the first high-profile contact between Ottawa and Washington since they failed to reach a trade agreement by Mr. Trump’s Aug. 1 deadline.
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Ottawa has been seeking some sort of deal that removes or lowers U.S. tariffs on a range of Canadian goods. Last month, Mr. Carney acknowledged Canada would probably not convince Mr. Trump to drop all tariffs.
Canada is one of only two countries that has retaliated against Mr. Trump’s efforts to remake the global trading system with the highest tariffs since the 1930s. The only other country to hit back with countertariffs is China.
Canada has imposed three rounds of retaliatory measures against the U.S. This includes a 25 per cent tariff on around $30-billion worth of U.S. goods, including orange juice and motorcycles; a second 25 per cent tariff on around $30-billion worth of U.S. metal products and other consumer goods; and a 25 per cent tariff on U.S. automobiles, with a carveout for companies that maintain production in Canada.
Canada subsequently watered down these tariffs, granting a series of exemptions, including for U.S. industrial inputs that are used by Canadian manufacturers.
Ottawa has made other efforts to try to secure a deal with the protectionist U.S. President, including increasing spending on the military and border security and scrapping the Digital Services Tax that hit U.S. tech companies.
Over the past month, other large U.S. trading partners that held off retaliation, including the European Union, Japan and South Korea, have signed trade deals with the White House that avoided the threat of even higher tariffs but left 15 per cent baseline tariffs and sectoral tariffs in place, with some carveouts.
Source: The Globe and Mail
See also https://www.cbc.ca/news/politics/canada-removing-retaliatory-tariffs-1.7614909
Watch the video of PM Carney’s press conference below.
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