Canada Hits Back With Tariffs on $20B in U.S. Goods as Trade War Escalates

TORONTO (AP) — Canadian Prime Minister Mark Carney announced Tuesday that his country would speed up its push to cut economic dependence on the United States, as retaliatory tariffs on approximately $20 billion in American goods went into effect and Canada prepared for a potential response from President Donald Trump. 'In too many areas, they wanted dependency, not a true economic partnership,' Carney said in a prerecorded video laying out his government's strategy for weathering the trade war. He argued that four decades of deepening economic ties had left Canada overly dependent on its southern neighbor. The trade conflict began after Trump returned to the White House and slapped a series of tariffs on Canadian goods — despite having negotiated and frequently praised the North American trade agreement during his first term in office. Many of those tariffs are seen as violations of that agreement. The breakdown is particularly jarring given the historically close bond between the two countries, which have long shared deeply intertwined economies, strong defense and security partnerships, broad cultural connections, and — before relations soured — roughly 400,000 people crossing the border every single day. While acknowledging that the latest U.S. trade actions would cause near-term hardship, Carney said they were pushing Canada to move more quickly on investment, infrastructure, and expanding trade with other nations. He admitted the transition would come at a cost, but warned that doing nothing would be even more expensive. Carney drew a sharp contrast between Canada's fraying relationship with Washington and its strengthening ties with what he described as more dependable partners. 'For the past year and a half, we have been steering our economy toward trusted partners,' he said. 'It was easy business, but it meant we relied too much on one economic partner,' he added. 'That time is over.' The prime minister stood by Canada's decision to retaliate, saying his country was matching U.S. measures dollar for dollar, while also working to support workers and industries affected by the dispute and pushing to open new trade relationships abroad. 'We can't let American goods into Canada tariff-free while they charge our companies to export to them,' Carney said. He stressed that Canada was not trying to escalate the situation, but that the tariffs were essential to protecting Canadian workers. Carney also defended Canada's choice to walk away from trade negotiations, saying Washington had pushed for restrictions on French-language and cultural protections, sought influence over future trade agreements, and demanded terms that would have damaged Canada's auto, steel, and forestry industries. The outcome of this trade dispute could have implications well beyond Canada, serving as a test of whether a smaller U.S. ally can resist economic pressure from Washington without ultimately being forced to back down. U.S. Trade Representative Jamieson Greer has hinted that Washington could respond by blocking certain Canadian products from entering the American market. The new Canadian tariffs target hundreds of U.S. products — including steel, aluminum, cheese, appliances, clothing, cosmetics, and farm equipment — at rates of 15%, 25%, or 50%. Altogether, they cover about $20 billion in American goods, which represents roughly 6% of the $333.6 billion the United States exported to Canada last year. Since Canada-U.S. trade talks fell apart on August 21, Trump and his administration have piled on additional tariffs and issued a string of threats and statements portraying Canada as weak and dependent on the U.S. Trump's trade offensive and his repeated suggestions that Canada should become the 51st U.S. state have stoked anger north of the border and boosted support for Carney. Canadians have responded by dramatically cutting back travel to the United States and avoiding American products. Carney praised those efforts, saying 'every time we choose to buy Canadian and travel in Canada, we are sending a message that nobody is in the stands, 40 million of us are on the ice.' Gabriel Brunet, a spokesman for Canada-U.S. Trade Minister Dominic LeBlanc, said officials from both countries are still in communication even though formal negotiations have not restarted. 'Canadian and American officials have maintained ongoing discussions on a range of issues, although formal trade negotiations are not taking place at this stage,' Brunet said. Former U.S. trade official Wendy Cutler said neither side appeared eager to make the first move toward resuming talks. 'With a growing public approval rating now topping 70%, Prime Minister Carney is not in any hurry to reach out to Washington. But importantly, he has not closed the door to talks,' she said. 'Clearly, at this point each side does not want to look too anxious to reengage in fear of looking weak.'