Canada's retaliatory tariffs against C$27.6bn ($20bn) of US goods went into effect today, as the trade war between the two tightly-linked countries escalates.
Canada is imposing as much as a 50pc tariff on nearly 650 US products, including milk, cheese, steel, aluminum, wood and paper products, honey, and perfume. The trade action comes after the US on 22 August imposed new tariffs on Canadian goods after negotiations broke down the day before.
"Since a fair deal wasn't on the table, we made the right choice to walk away from a bad one," Canadian prime minister Mark Carney said in a video address to Canadians posted Tuesday. "They wanted us to become even more reliant on them, not less."
Carney said an escalating conflict is not constructive, but the tariffs put in place today are necessary to protect Canadian businesses.
Canada was among the first targeted by US president Donald Trump's trade actions at the start of his second term, prompting Carney to shore up trade deals elsewhere with the goal of doubling trade with non-US countries within the next 10 years.
Canada's merchandise exports to the US fell to a four-month low of C$51bn in July, while a record outflow to other regions, including the EU and China, was registered.
Carney on 1 September said Canada is open to resuming trade talks once the US "starts being serious".
Five days later, Trump on social media complained about the Canada-US exchange rate, before making another post referring to Carney as "Governor" — a repeated taunt suggesting that Canada become the 51st state. He also renamed the one of the lakes bordering the countries, Lake Ontario, as "Lake America."
Trump on Monday took aim at Canadian-based jet manufacturer Bombardier by writing "NO MORE SELLING BOMBARDIER IN THE UNITED STATES!" in a social media post.
Bombardier's jets are manufactured in Canada, Mexico, and the US where it does business with 2,800 US companies across 47 states.
"The American aerospace industry is a clear winner on trade and exports," Bombardier said in a statement the same day.
On a provincial level, Saskatchewan is levying a 50pc tax on US alcohol, also effective on Tuesday. Alberta, now the lone province not acting against US alcohol imports, has said it is under consideration. Some provincial leaders have called on Alberta to restrict energy exports to the US, but Alberta has maintained its preference for diplomacy.
